Breville Group Limited Beat Revenue Forecasts By 12%: Here's What Analysts Are Forecasting Next

Breville Group Limited (ASX:BRG) investors will be delighted, with the company turning in some strong numbers with its latest results. Breville Group beat revenue and statutory earnings per share (EPS) expectations, with sales hitting AU$711m (12% ahead of estimates) and EPS reaching AU$0.47 (a 8.4% beat). 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 Breville Group

Following the latest results, Breville Group's twelve analysts are now forecasting revenues of AU$1.16b in 2021. This would be a sizeable 22% improvement in sales compared to the last 12 months. Statutory earnings per share are predicted to surge 34% to AU$0.68. Before this earnings report, the analysts had been forecasting revenues of AU$1.10b and earnings per share (EPS) of AU$0.65 in 2021. It looks like there's been a modest increase in sentiment following the latest results, withthe analysts becoming a bit more optimistic in their predictions for both revenues and earnings.

With these upgrades, we're not surprised to see that the analysts have lifted their price target 15% to AU$29.86per share. The consensus price target is just an average of individual analyst targets, so - it could be handy to see how wide the range of underlying estimates is. Currently, the most bullish analyst values Breville Group at AU$35.95 per share, while the most bearish prices it at AU$18.00. This is a fairly broad spread of estimates, suggesting that analysts are forecasting a wide range of possible outcomes for the business.

Of course, another way to look at these forecasts is to place them into context against the industry itself. We can infer from the latest estimates that forecasts expect a continuation of Breville Group'shistorical trends, as next year's 22% revenue growth is roughly in line with 25% annual revenue growth over the past year. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to see their revenues grow 10% per year. So although Breville Group is expected to maintain its revenue growth rate, it's definitely expected to grow faster than the wider industry.

The Bottom Line

The most important thing here is that the analysts upgraded their earnings per share estimates, suggesting that there has been a clear increase in optimism towards Breville Group following these results. Pleasantly, they also upgraded their revenue estimates, and their forecasts suggest the business is expected to grow faster than the wider industry. We note an upgrade to the price target, suggesting that the analysts believes the intrinsic value of the business is likely to improve over time.

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 estimates - from multiple Breville Group analysts - going out to 2023, and you can see them free on our platform here.

Even so, be aware that Breville Group is showing 1 warning sign in our investment analysis , you should know about...

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