Ventia Services Group Limited (ASX:VNT) Half-Yearly Results Just Came Out: Here's What Analysts Are Forecasting For This Year

Ventia Services Group Limited (ASX:VNT) shareholders are probably feeling a little disappointed, since its shares fell 4.3% to AU$2.66 in the week after its latest half-year results. Results overall were respectable, with statutory earnings of AU$0.10 per share roughly in line with what the analysts had forecast. Revenues of AU$2.8b came in 2.4% ahead of analyst predictions. Following the result, the 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. With this in mind, we've gathered the latest statutory forecasts to see what the analysts are expecting for next year.

Check out our latest analysis for Ventia Services Group

Taking into account the latest results, the current consensus from Ventia Services Group's seven analysts is for revenues of AU$5.66b in 2023. This would reflect a modest 4.0% increase on its revenue over the past 12 months. Statutory earnings per share are predicted to rise 2.1% to AU$0.21. Before this earnings report, the analysts had been forecasting revenues of AU$5.55b and earnings per share (EPS) of AU$0.21 in 2023. So it looks like there's been no major change in sentiment following the latest results, although the analysts have made a small increase to to revenue forecasts.

It may not be a surprise to see thatthe analysts have reconfirmed their price target of AU$3.26, implying that the uplift in revenue is not expected to greatly contribute to Ventia Services Group's valuation in the near term. Fixating on a single price target can be unwise though, since the consensus target is effectively the average of analyst price targets. As a result, some investors like to look at the range of estimates to see if there are any diverging opinions on the company's valuation. Currently, the most bullish analyst values Ventia Services Group at AU$4.00 per share, while the most bearish prices it at AU$2.45. Analysts definitely have varying views on the business, but the spread of estimates is not wide enough in our view to suggest that extreme outcomes could await Ventia Services Group shareholders.

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Ventia Services Group's past performance and to peers in the same industry. We would highlight that Ventia Services Group's revenue growth is expected to slow, with the forecast 8.2% annualised growth rate until the end of 2023 being well below the historical 14% growth over the last year. Juxtapose this against the other companies in the industry with analyst coverage, which are forecast to grow their revenues (in aggregate) 6.5% per year. So it's pretty clear that, while Ventia Services Group's revenue growth is expected to slow, it's still expected to grow faster than the industry itself.

The Bottom Line

The most obvious conclusion is that there's been no major change in the business' prospects in recent times, with the analysts holding their earnings forecasts steady, in line with previous estimates. Happily, they also upgraded their revenue estimates, and are forecasting them to grow faster than the wider industry. 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.

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 Ventia Services Group going out to 2025, and you can see them free on our platform here.

Plus, you should also learn about the 2 warning signs we've spotted with Ventia Services Group .

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

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.