Yahoo Finance Stadler Rail AG Just Missed EPS By 41%: Here's What Analysts Think Will Happen Next
It's shaping up to be a tough period for Stadler Rail AG (VTX:SRAIL), which a week ago released some disappointing yearly results that could have a notable impact on how the market views the stock. It wasn't a great result overall - while revenue fell marginally short of analyst estimates at CHF3.8b, statutory earnings missed forecasts by an incredible 41%, coming in at just CHF0.73 per share. Earnings are an important time for investors, as they can track a company's performance, look at what the analysts are forecasting for next year, and see if there's been a change in sentiment towards the company. So we gathered the latest post-earnings forecasts to see what estimates suggest is in store for next year.
View our latest analysis for Stadler Rail
Following the latest results, Stadler Rail's nine analysts are now forecasting revenues of CHF3.93b in 2023. This would be a modest 4.7% improvement in sales compared to the last 12 months. Per-share earnings are expected to surge 104% to CHF1.49. Yet prior to the latest earnings, the analysts had been anticipated revenues of CHF4.13b and earnings per share (EPS) of CHF1.76 in 2023. The analysts seem less optimistic after the recent results, reducing their sales forecasts and making a substantial drop in earnings per share numbers.
Despite the cuts to forecast earnings, there was no real change to the CHF33.56 price target, showing that the analysts don't think the changes have a meaningful impact on its intrinsic value. Fixating on a single price target can be unwise though, since the consensus target is effectively the average of analyst price targets. As a result, some investors like to look at the range of estimates to see if there are any diverging opinions on the company's valuation. Currently, the most bullish analyst values Stadler Rail at CHF42.00 per share, while the most bearish prices it at CHF22.00. 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 Stadler Rail shareholders.
Of course, another way to look at these forecasts is to place them into context against the industry itself. It's pretty clear that there is an expectation that Stadler Rail's revenue growth will slow down substantially, with revenues to the end of 2023 expected to display 4.7% growth on an annualised basis. This is compared to a historical growth rate of 12% over the past five years. Juxtapose this against the other companies in the industry with analyst coverage, which are forecast to grow their revenues (in aggregate) 4.9% annually. So it's pretty clear that, while Stadler Rail's revenue growth is expected to slow, it's expected to grow roughly in line with the industry.
The Bottom Line
The biggest concern is that the analysts reduced their earnings per share estimates, suggesting business headwinds could lay ahead for Stadler Rail. Sadly, they also downgraded their sales forecasts, but the business is still expected to grow at roughly the same rate as the industry itself. 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.
Following on from that line of thought, we think that the long-term prospects of the business are much more relevant than next year's earnings. At Simply Wall St, we have a full range of analyst estimates for Stadler Rail going out to 2025, and you can see them free on our platform here..
That said, it's still necessary to consider the ever-present spectre of investment risk. We've identified 3 warning signs with Stadler Rail , and understanding them should be part of your investment process.
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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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