Here's What Analysts Are Forecasting For adidas AG After Its Latest Third-Quarter Results

adidas AG (ETR:ADS) shares fell 2.9% to €272 in the week since its latest third-quarter results. adidas reported €6.4b in revenue, roughly in line with analyst forecasts, although earnings per share (EPS) of €3.27 beat expectations, being 2.6% higher than what analysts expected. 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. We thought readers would find it interesting to see analysts' latest post-earnings forecasts for next year.

Check out our latest analysis for adidas

Following the latest results, adidas's 33 analysts are now forecasting revenues of €25b in 2020. This would be a solid 9.9% improvement in sales compared to the last 12 months. Earnings per share are expected to expand 19% to €10.92. Before this earnings report, analysts had been forecasting revenues of €25b and earnings per share (EPS) of €11.00 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 €278, showing that the business is executing well and in line with expectations. The consensus price target just an average of individual analyst targets, so - considering that the price target changed, it would be handy to see how wide the range of underlying estimates is. The most optimistic adidas analyst has a price target of €325 per share, while the most pessimistic values it at €203. There are definitely some different views on the stock, but the range of estimates is not wide enough as to imply that the situation is unforecastable, in our view.

Another way we can view these estimates is in the context of the bigger picture, such as how the forecasts stack up against past performance, and whether analysts are more or less bullish relative to other companies in the market. We can infer from the latest estimates that analysts are expecting a continuation of adidas's historical trends, as next year's forecast 9.9% revenue growth is roughly in line with 9.5% annual revenue 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 7.0% per year. So it's pretty clear that adidas is forecast to grow substantially faster than its 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. Fortunately, analysts also reconfirmed their revenue estimates, suggesting sales are tracking in line with expectations - and our data does suggest that adidas's revenues are expected to grow faster than the wider market. 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.

Still, the long-term prospects of the business are much more relevant than next year's earnings. We have estimates - from multiple adidas analysts - going out to 2023, and you can see them free on our platform here.

We also provide an overview of the adidas Board and CEO remuneration and length of tenure at the company, and whether insiders have been buying the stock, here.

We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.

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. Thank you for reading.