Yahoo Finance Swedbank AB (publ) Annual Results Just Came Out: Here's What Analysts Are Forecasting For Next Year
Investors in Swedbank AB (publ) (STO:SWED A) had a good week, as its shares rose 6.9% to close at kr144 following the release of its yearly results. It was a credible result overall, with revenues of kr44b and statutory earnings per share of kr17.56 both in line with analyst estimates, showing that Swedbank is executing in line with expectations. Following the result, analysts have updated their earnings model, and it would be good to know whether they think there's been a strong change in the company's prospects, or if it's business as usual. So we gathered the latest post-earnings forecasts to see what analysts' statutory forecasts suggest is in store for next year.
Check out our latest analysis for Swedbank
Taking into account the latest results, the current consensus from Swedbank's 14 analysts is for revenues of kr45.5b in 2020, which would reflect a credible 2.2% increase on its sales over the past 12 months. Statutory earnings per share are expected to dip 5.8% to kr16.60 in the same period. In the lead-up to this report, analysts had been modelling revenues of kr45.5b and earnings per share (EPS) of kr16.85 in 2020. So it's pretty clear that, although analysts have updated their estimates, there's been no major change in expectations for the business following the latest results.
Analysts reconfirmed their price target of kr159, showing that the business is executing well and in line with expectations. 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. The most optimistic Swedbank analyst has a price target of kr242 per share, while the most pessimistic values it at kr115. This is a fairly broad spread of estimates, suggesting that analysts are forecasting a wide range of possible outcomes for the business.
Further, we can compare these estimates to past performance, and see how Swedbank forecasts compare to the wider market's forecast performance. We would highlight that Swedbank's revenue growth is expected to slow, with forecast 2.2% increase next year well below the historical 4.0%p.a. growth over the last five years. Compare this to the other companies in this market with analyst coverage, which are forecast to grow their revenue at 2.4% per year. Factoring in the forecast slowdown in growth, it looks like analysts are expecting Swedbank to grow at about the same rate as the wider market.
The Bottom Line
The most important thing to take away is that there's been no major change in sentiment, with analysts reconfirming that earnings per share are expected to continue performing in line with their prior expectations. Happily, there were no real changes to sales forecasts, with the business still expected to grow in line with the overall market. The consensus price target held steady at kr159, with the latest estimates not enough to have an impact on analysts' estimated valuations.
Even so, the longer term trajectory of the business is much more important for the value creation of shareholders. At Simply Wall St, we have a full range of analyst estimates for Swedbank going out to 2022, and you can see them free on our platform here..
You can also view our analysis of Swedbank's balance sheet, and whether we think Swedbank is carrying too much debt, for free on our platform here.
If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned.
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