It's been a good week for Sixt SE (ETR:SIX2) shareholders, because the company has just released its latest quarterly results, and the shares gained 4.6% to €97.60. It was an okay result overall, with revenues coming in at €997m, roughly what the analysts had been expecting. This is an important time for investors, as they can track a company's performance in its report, look at what experts are forecasting for next year, and see if there has been any change to expectations for the business. So we gathered the latest post-earnings forecasts to see what estimates suggest is in store for next year.
Taking into account the latest results, the current consensus, from the nine analysts covering Sixt, is for revenues of €2.89b in 2023, which would reflect a noticeable 3.3% reduction in Sixt's sales over the past 12 months. Statutory earnings per share are expected to tumble 33% to €6.05 in the same period. Before this earnings report, the analysts had been forecasting revenues of €2.89b and earnings per share (EPS) of €6.11 in 2023. The consensus analysts don't seem to have seen anything in these results that would have changed their view on the business, given there's been no major change to their estimates.
It will come as no surprise then, to learn that the consensus price target is largely unchanged at €132. The consensus price target is just an average of individual analyst targets, so - it could be handy to see how wide the range of underlying estimates is. There are some variant perceptions on Sixt, with the most bullish analyst valuing it at €158 and the most bearish at €87.00 per share. Analysts definitely have varying views on the business, but the spread of estimates is not wide enough in our view to suggest that extreme outcomes could await Sixt shareholders.
Looking at the bigger picture now, one of the ways we can make sense of these forecasts is to see how they measure up against both past performance and industry growth estimates. One thing that stands out from these estimates is that shrinking revenues are expected to moderate over the period ending 2023 compared to the historical decline of 4.5% per annum over the past five years. Compare this against analyst estimates for companies in the broader industry, which suggest that revenues (in aggregate) are expected to grow 8.4% annually. So while a broad number of companies are forecast to grow, unfortunately Sixt is expected to see its sales affected worse than other companies in the industry.
The Bottom Line
The most important thing to take away is that there's been no major change in sentiment, with the analysts reconfirming that the business is performing in line with their previous earnings per share estimates. Fortunately, the analysts also reconfirmed their revenue estimates, suggesting sales are tracking in line with expectations - although our data does suggest that Sixt's revenues are expected to perform worse than the wider industry. There was no real change to the consensus price target, suggesting that the intrinsic value of the business has not undergone any major changes with the latest estimates.
With that in mind, we wouldn't be too quick to come to a conclusion on Sixt. Long-term earnings power is much more important than next year's profits. We have estimates - from multiple Sixt analysts - going out to 2024, and you can see them free on our platform here.
However, before you get too enthused, we've discovered 3 warning signs for Sixt (1 makes us a bit uncomfortable!) that you should be aware of.
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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
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