Erste Group Bank AG (VIE:EBS) Interim Results Just Came Out: Here's What Analysts Are Forecasting For This Year

Shareholders might have noticed that Erste Group Bank AG (VIE:EBS) filed its interim result this time last week. The early response was not positive, with shares down 8.9% to €43.55 in the past week. Erste Group Bank reported in line with analyst predictions, delivering revenues of €2.7b and statutory earnings per share of €6.81, suggesting the business is executing well and in line with its plan. 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. With this in mind, we've gathered the latest statutory forecasts to see what the analysts are expecting for next year.

View our latest analysis for Erste Group Bank

Taking into account the latest results, the consensus forecast from Erste Group Bank's ten analysts is for revenues of €10.7b in 2024. This reflects a credible 2.0% improvement in revenue compared to the last 12 months. Statutory earnings per share are expected to dip 7.2% to €6.89 in the same period. Yet prior to the latest earnings, the analysts had been anticipated revenues of €10.6b and earnings per share (EPS) of €6.60 in 2024. The analysts seems to have become more bullish on the business, judging by their new earnings per share estimates.

The consensus price target was unchanged at €53.81, implying that the improved earnings outlook is not expected to have a long term impact on value creation for shareholders. There's another way to think about price targets though, and that's to look at the range of price targets put forward by analysts, because a wide range of estimates could suggest a diverse view on possible outcomes for the business. The most optimistic Erste Group Bank analyst has a price target of €65.00 per share, while the most pessimistic values it at €46.00. 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.

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Erste Group Bank's past performance and to peers in the same industry. We would highlight that Erste Group Bank's revenue growth is expected to slow, with the forecast 4.1% annualised growth rate until the end of 2024 being well below the historical 10% p.a. growth over the last five years. Juxtapose this against the other companies in the industry with analyst coverage, which are forecast to grow their revenues (in aggregate) 2.9% per year. So it's pretty clear that, while Erste Group Bank's revenue growth is expected to slow, it's still expected to grow faster than the industry itself.

The Bottom Line

The biggest takeaway for us is the consensus earnings per share upgrade, which suggests a clear improvement in sentiment around Erste Group Bank's earnings potential next year. Fortunately, they also reconfirmed their revenue numbers, suggesting that it's tracking in line with expectations. Additionally, our data suggests that revenue is expected to grow faster than the wider industry. The consensus price target held steady at €53.81, with the latest estimates not enough to have an impact on their price targets.

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. We have forecasts for Erste Group Bank going out to 2026, 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 2 warning signs with Erste Group Bank (at least 1 which is potentially serious) , and understanding these 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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com