Hapvida Participações e Investimentos S.A. (BVMF:HAPV3) came out with its yearly results last week, and we wanted to see how the business is performing and what industry forecasters think of the company following this report. Revenues were R$8.3b, with Hapvida Participações e Investimentos reporting some 2.9% below analyst expectations. This is an important time for investors, as they can track a company's performance in its report, look at what experts are forecasting for next year, and see if there has been any change to expectations for the business. So we gathered the latest post-earnings forecasts to see what estimates suggest is in store for next year.
Taking into account the latest results, the consensus forecast from Hapvida Participações e Investimentos' ten analysts is for revenues of R$10.3b in 2021, which would reflect a huge 25% improvement in sales compared to the last 12 months. Statutory earnings per share are predicted to bounce 22% to R$0.30. In the lead-up to this report, the analysts had been modelling revenues of R$10.3b and earnings per share (EPS) of R$0.30 in 2021. So it's pretty clear that, although the analysts have updated their estimates, there's been no major change in expectations for the business following the latest results.
It will come as no surprise then, to learn that the consensus price target is largely unchanged at R$17.94. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. Currently, the most bullish analyst values Hapvida Participações e Investimentos at R$21.50 per share, while the most bearish prices it at R$14.00. 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 Hapvida Participações e Investimentos shareholders.
These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Hapvida Participações e Investimentos' past performance and to peers in the same industry. We can infer from the latest estimates that forecasts expect a continuation of Hapvida Participações e Investimentos'historical trends, as the 25% annualised revenue growth to the end of 2021 is roughly in line with the 21% annual revenue growth over the past five years. Compare this with the broader industry, which analyst estimates (in aggregate) suggest will see revenues grow 19% annually. So it's pretty clear that Hapvida Participações e Investimentos is forecast to grow substantially faster than its 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. Happily, there were no major changes to revenue forecasts, with the business still expected to grow faster than the wider industry. The consensus price target held steady at R$17.94, with the latest estimates not enough to have an impact on their price targets.
Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. We have forecasts for Hapvida Participações e Investimentos going out to 2025, and you can see them free on our platform here.
You should always think about risks though. Case in point, we've spotted 1 warning sign for Hapvida Participações e Investimentos you should be aware of.
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