Tessenderlo Group NV (EBR:TESB) Just Reported And Analysts Have Been Cutting Their Estimates

Last week, you might have seen that Tessenderlo Group NV (EBR:TESB) released its full-year result to the market. The early response was not positive, with shares down 5.8% to €24.25 in the past week. Revenues were €2.9b, with Tessenderlo Group reporting some 6.9% below analyst expectations. Earnings are an important time for investors, as they can track a company's performance, look at what the analyst is forecasting for next year, and see if there's been a change in sentiment towards the company. So we collected the latest post-earnings statutory consensus estimate to see what could be in store for next year.

See our latest analysis for Tessenderlo Group

Taking into account the latest results, the current consensus, from the sole analyst covering Tessenderlo Group, is for revenues of €2.84b in 2023. This implies a measurable 3.1% reduction in Tessenderlo Group's revenue over the past 12 months. Statutory earnings per share are expected to decline 17% to €1.44 in the same period. Yet prior to the latest earnings, the analyst had been anticipated revenues of €3.07b and earnings per share (EPS) of €2.57 in 2023. From this we can that sentiment has definitely become more bearish after the latest results, leading to lower revenue forecasts and a large cut to earnings per share estimates.

Despite the cuts to forecast earnings, there was no real change to the €39.00 price target, showing that the analyst doesn't think the changes have a meaningful impact on its intrinsic value.

Of course, another way to look at these forecasts is to place them into context against the industry itself. These estimates imply that revenue is expected to slow, with a forecast annualised decline of 100% by the end of 2023. This indicates a significant reduction from annual growth of 13% 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 8.5% annually for the foreseeable future. The forecasts do look bearish for Tessenderlo Group, 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 downgraded their earnings per share estimates, showing that there has been a clear decline in sentiment following these results. Unfortunately they also cut their revenue estimates for next year. Forecasts imply the business' revenue is expected to perform worse than the wider industry. That said, earnings per share are more important for creating value for shareholders. The consensus price target held steady at €39.00, with the latest estimates not enough to have an impact on their price target.

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 analyst estimates for Tessenderlo Group going out as far as 2026, and you can see them free on our platform here.

You should always think about risks though. Case in point, we've spotted 2 warning signs for Tessenderlo Group you should be aware of.

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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.