ElringKlinger AG (ETR:ZIL2) shareholders are probably feeling a little disappointed, since its shares fell 5.8% to €4.34 in the week after its latest second-quarter results. Revenues came in 3.3% below expectations, at €445m. Statutory earnings per share were relatively better off, with a per-share profit of €0.62 being roughly in line with analyst estimates. The analysts typically update their forecasts at each earnings report, and we can judge from their estimates whether their view of the company has changed or if there are any new concerns to be aware of. So we gathered the latest post-earnings forecasts to see what estimates suggest is in store for next year.
Check out our latest analysis for ElringKlinger
Following last week’s earnings report, ElringKlinger’s six analysts are forecasting 2024 revenues to be €1.83b, approximately in line with the last 12 months. Statutory earnings per share are expected to drop 17% to €0.70 in the same period. In the lead-up to this report, the analysts had been modelling revenues of €1.85b and earnings per share (EPS) of €0.64 in 2024. There was no real change to the revenue estimates, but the analysts do seem more bullish on earnings, given the solid gain to earnings per share expectations following these results.
The consensus price target fell 11% to €6.83, suggesting the increase in earnings forecasts was not enough to offset other the analysts concerns. 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. The most optimistic ElringKlinger analyst has a price target of €10.50 per share, while the most pessimistic values it at €4.70. This is a fairly broad spread of estimates, suggesting that analysts are forecasting a wide range of possible outcomes for the business.
Of course, another way to look at these forecasts is to place them into context against the industry itself. The period to the end of 2024 brings more of the same, according to the analysts, with revenue forecast to display 3.7% growth on an annualised basis. That is in line with its 3.1% annual growth over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to see their revenues grow 5.8% per year. So although ElringKlinger is expected to maintain its revenue growth rate, it’s forecast to grow slower than the wider industry.
The Bottom Line
The most important thing here is that the analysts upgraded their earnings per share estimates, suggesting that there has been a clear increase in optimism towards ElringKlinger following these results. On the plus side, there were no major changes to revenue estimates; although forecasts imply they will perform worse than the wider industry. Furthermore, the analysts also cut their price targets, suggesting that the latest news has led to greater pessimism about the intrinsic value of the business.
Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. We have forecasts for ElringKlinger going out to 2026, and you can see them free on our platform here.
You still need to take note of risks, for example – ElringKlinger has 2 warning signs we think 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.