Fleury S.A. Just Beat Analyst Forecasts, And Analysts Have Been Updating Their Predictions

Fleury S.A. (BVMF:FLRY3) just released its annual report and things are looking bullish. The company beat both earnings and revenue forecasts, with revenue of R$3.0b, some 3.5% above estimates, and statutory earnings per share (EPS) coming in at R$0.80, 24% ahead of expectations. The analysts typically update their forecasts at each earnings report, and we can judge from their estimates whether their view of the company has changed or if there are any new concerns to be aware of. So we gathered the latest post-earnings forecasts to see what estimates suggest is in store for next year.

View our latest analysis for Fleury

Following the latest results, Fleury's eleven analysts are now forecasting revenues of R$3.30b in 2021. This would be a decent 11% improvement in sales compared to the last 12 months. Statutory earnings per share are predicted to leap 98% to R$1.08. Yet prior to the latest earnings, the analysts had been anticipated revenues of R$3.30b and earnings per share (EPS) of R$1.10 in 2021. The consensus analysts don't seem to have seen anything in these results that would have changed their view on the business, given there's been no major change to their estimates.

It will come as no surprise then, to learn that the consensus price target is largely unchanged at R$30.06. 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. The most optimistic Fleury analyst has a price target of R$38.00 per share, while the most pessimistic values it at R$28.00. This shows there is still a bit of diversity in estimates, but analysts don't appear to be totally split on the stock as though it might be a success or failure situation.

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. The analysts are definitely expecting Fleury's growth to accelerate, with the forecast 11% growth ranking favourably alongside historical growth of 8.7% per annum over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to grow their revenue at 20% per year. It seems obvious that, while the future growth outlook is brighter than the recent past, Fleury is expected to grow slower than the wider industry.

The Bottom Line

The most important thing to take away is that there's been no major change in sentiment, with the analysts reconfirming that the business is performing in line with their previous earnings per share estimates. Fortunately, the analysts also reconfirmed their revenue estimates, suggesting sales are tracking in line with expectations - although our data does suggest that Fleury's revenues are expected to perform worse than the wider industry. The consensus price target held steady at R$30.06, with the latest estimates not enough to have an impact on their price targets.

With that in mind, we wouldn't be too quick to come to a conclusion on Fleury. Long-term earnings power is much more important than next year's profits. We have forecasts for Fleury going out to 2023, and you can see them free on our platform here.

Don't forget that there may still be risks. For instance, we've identified 2 warning signs for Fleury (1 is a bit concerning) you should be aware of.

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