The EVN AG (VIE:EVN) Analyst Just Cut Their Revenue Forecast By 11%

The latest analyst coverage could presage a bad day for EVN AG (VIE:EVN), with the covering analyst making across-the-board cuts to their statutory estimates that might leave shareholders a little shell-shocked. Revenue estimates were cut sharply as the analyst signalled a weaker outlook - perhaps a sign that investors should temper their expectations as well.

Following the latest downgrade, the current consensus, from the solitary analyst covering EVN, is for revenues of €3.5b in 2024, which would reflect a measurable 2.4% reduction in EVN's sales over the past 12 months. Statutory earnings per share are supposed to fall 14% to €2.52 in the same period. Previously, the analyst had been modelling revenues of €3.9b and earnings per share (EPS) of €2.66 in 2024. Indeed, we can see that analyst sentiment has declined measurably after the new consensus came out, with a measurable cut to revenue estimates and a small dip in EPS estimates to boot.

View our latest analysis for EVN

The consensus price target fell 13% to €31.70, with the weaker earnings outlook clearly leading analyst valuation estimates.

Of course, another way to look at these forecasts is to place them into context against the industry itself. These estimates imply that sales are expected to slow, with a forecast annualised revenue decline of 2.4% by the end of 2024. This indicates a significant reduction from annual growth of 17% over the last five years. By contrast, our data suggests that other companies (with analyst coverage) in the industry are forecast to see their revenue decline 0.6% annually for the foreseeable future. The forecasts do look bearish for EVN, since they're expecting it to shrink faster than the industry.

The Bottom Line

The most important thing to take away is that the analyst cut their earnings per share estimates, expecting a clear decline in business conditions. Unfortunately they also downgraded their revenue estimates, and our aggregation of analyst estimates suggests that EVN revenue is expected to perform worse than the wider market. The consensus price target fell measurably, with the analyst seemingly not reassured by recent business developments, leading to a lower estimate of EVN's future valuation. Overall, given the drastic downgrade to this year's forecasts, we'd be feeling a little more wary of EVN going forwards.

Unfortunately, by using these new estimates as a starting point, we've run a discounted cash flow calculation (DCF) on EVN that suggests the company could be somewhat overvalued. Find out why, and see how we estimate the valuation for free on our platform here.

Of course, seeing company management invest large sums of money in a stock can be just as useful as knowing whether analysts are downgrading their estimates. So you may also wish to search this free list of stocks that insiders are buying.

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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.