New Forecasts: Here's What Analysts Think The Future Holds For Solvay SA (EBR:SOLB)

Shareholders in Solvay SA (EBR:SOLB) may be thrilled to learn that the analysts have just delivered a major upgrade to their near-term forecasts. The consensus statutory numbers for both revenue and earnings per share (EPS) increased, with their view clearly much more bullish on the company's business prospects.

After the upgrade, the consensus from Solvay's 13 analysts is for revenues of €12b in 2022, which would reflect a definite 14% decline in sales compared to the last year of performance. Statutory earnings per share are supposed to plummet 26% to €11.79 in the same period. Previously, the analysts had been modelling revenues of €11b and earnings per share (EPS) of €10.39 in 2022. So we can see there's been a pretty clear increase in analyst sentiment in recent times, with both revenues and earnings per share receiving a decent lift in the latest estimates.

Check out our latest analysis for Solvay

Another way we can view these estimates is in the context of the bigger picture, such as how the forecasts stack up against past performance, and whether forecasts are more or less bullish relative to other companies in the industry. We would highlight that sales are expected to reverse, with a forecast 26% annualised revenue decline to the end of 2022. That is a notable change from historical growth of 1.0% 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 1.1% annually for the foreseeable future. The forecasts do look bearish for Solvay, since they're expecting it to shrink faster than the industry.

The Bottom Line

The biggest takeaway for us from these new estimates is that analysts upgraded their earnings per share estimates, with improved earnings power expected for this year. Notably, analysts also upgraded their revenue estimates, with sales performing well although Solvay's revenue growth is expected to trail that of the wider market. More bullish expectations could be a signal for investors to take a closer look at Solvay.

Better yet, our automated discounted cash flow calculation (DCF) suggests Solvay could be moderately undervalued. You can learn more about our valuation methodology on our platform here.

Another way to search for interesting companies that could be reaching an inflection point is to track whether management are buying or selling, with our free list of growing companies 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.