It’s been a pretty great week for KRUK Spólka Akcyjna (WSE:KRU) shareholders, with its shares surging 10% to zł135 in the week since its latest quarterly results. KRUK Spólka Akcyjna beat revenue expectations by 5.8%, recording sales of zł326m. Earnings per share (EPS) came in at zł17.09, some 4.1% short of analyst estimates. 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. We thought readers would find it interesting to see analysts’ latest post-earnings forecasts for next year.
Taking into account the latest results, the most recent consensus for KRUK Spólka Akcyjna from five analysts is for revenues of zł1.4b in 2020, which is a meaningful 12% increase on its sales over the past 12 months. Earnings per share are expected to grow 18% to zł18.47. Before this earnings report, analysts had been forecasting revenues of zł1.4b and earnings per share (EPS) of zł19.02 in 2020. Analysts seem to have become a little more negative on the business after the latest results, given the small dip in their earnings per share forecasts for next year.
The consensus price target held steady at zł180, with analysts seemingly voting that their lower forecast earnings are not expected to lead to a lower stock price in the foreseeable future. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. There are some variant perceptions on KRUK Spólka Akcyjna, with the most bullish analyst valuing it at zł236 and the most bearish at zł85.00 per share. This is a fairly broad spread of estimates, suggesting that analysts are forecasting a wide range of possible outcomes for the business.
These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how analyst forecasts compare, both to the KRUK Spólka Akcyjna’s past performance and to peers in the same market. We would highlight that KRUK Spólka Akcyjna’s revenue growth is expected to slow, with forecast 12% increase next year well below the historical 20%p.a. growth over the last five years. Juxtapose this against the other companies in the market with analyst coverage, which are forecast to grow their revenues (in aggregate) 9.9% next year. Factoring in the forecast slowdown in growth, it looks like analysts are expecting KRUK Spólka Akcyjna to grow at about the same rate as the wider market.
The Bottom Line
The most important thing to take away is that analysts downgraded their earnings per share estimates, showing that there has been a clear decline in sentiment following these results. They also reconfirmed their revenue estimates, with the company predicted to grow at about the same rate as the wider market. The consensus price target held steady at zł180, with the latest estimates not enough to have an impact on analysts’ estimated valuations.
Still, 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 KRUK Spólka Akcyjna going out to 2022, and you can see them free on our platform here..
You can also view our analysis of KRUK Spólka Akcyjna’s balance sheet, and whether we think KRUK Spólka Akcyjna is carrying too much debt, for free on our platform here.
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