Earnings Miss: Mayr-Melnhof Karton AG Missed EPS By 28% And Analysts Are Revising Their Forecasts

Mayr-Melnhof Karton AG (VIE:MMK) shareholders are probably feeling a little disappointed, since its shares fell 5.6% to €111 in the week after its latest yearly results. Statutory earnings per share fell badly short of expectations, coming in at €4.36, some 28% below analyst forecasts, although revenues were okay, approximately in line with analyst estimates at €4.2b. 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.

View our latest analysis for Mayr-Melnhof Karton

Taking into account the latest results, the most recent consensus for Mayr-Melnhof Karton from dual analysts is for revenues of €4.29b in 2024. If met, it would imply a modest 3.0% increase on its revenue over the past 12 months. Per-share earnings are expected to surge 118% to €9.73. Before this earnings report, the analysts had been forecasting revenues of €4.32b and earnings per share (EPS) of €11.99 in 2024. The analysts seem to have become more bearish following the latest results. While there were no changes to revenue forecasts, there was a real cut to EPS estimates.

The average price target fell 7.8% to €140, with reduced earnings forecasts clearly tied to a lower valuation estimate.

Looking at the bigger picture now, one of the ways we can make sense of these forecasts is to see how they measure up against both past performance and industry growth estimates. We would highlight that Mayr-Melnhof Karton's revenue growth is expected to slow, with the forecast 3.0% annualised growth rate until the end of 2024 being well below the historical 16% 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% annually. So it's pretty clear that, while Mayr-Melnhof Karton's revenue growth is expected to slow, it's expected to grow roughly in line with the industry.

The Bottom Line

The most important thing to take away is that the analysts downgraded their earnings per share estimates, showing that there has been a clear decline in sentiment following these results. Happily, there were no real changes to revenue forecasts, with the business still expected to grow in line with the overall 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.

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. At least one analyst has provided forecasts out to 2025, which can be seen for 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 Mayr-Melnhof Karton , 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.