News Flash: Analysts Just Made A Notable Upgrade To Their BB Seguridade Participações S.A. (BVMF:BBSE3) Forecasts

BB Seguridade Participações S.A. (BVMF:BBSE3) shareholders will have a reason to smile today, with the analysts making substantial upgrades to this year's statutory forecasts. The consensus estimated revenue numbers rose, with their view now clearly much more bullish on the company's business prospects. The stock price has risen 7.4% to R$30.58 over the past week, suggesting investors are becoming more optimistic. Could this big upgrade push the stock even higher?

Following the upgrade, the latest consensus from BB Seguridade Participações' twelve analysts is for revenues of R$7.0b in 2022, which would reflect a meaningful 13% improvement in sales compared to the last 12 months. Per-share earnings are expected to expand 15% to R$2.76. Prior to this update, the analysts had been forecasting revenues of R$6.1b and earnings per share (EPS) of R$2.70 in 2022. The most recent forecasts are noticeably more optimistic, with a nice gain to revenue estimates and a lift to earnings per share as well.

Check out our latest analysis for BB Seguridade Participações

Although the analysts have upgraded their earnings estimates, there was no change to the consensus price target of R$31.08, suggesting that the forecast performance does not have a long term impact on the company's valuation. 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. There are some variant perceptions on BB Seguridade Participações, with the most bullish analyst valuing it at R$35.00 and the most bearish at R$26.00 per share. With such a narrow range of valuations, analysts apparently share similar views on what they think the business is worth.

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the BB Seguridade Participações' past performance and to peers in the same industry. It's clear from the latest estimates that BB Seguridade Participações' rate of growth is expected to accelerate meaningfully, with the forecast 27% annualised revenue growth to the end of 2022 noticeably faster than its historical growth of 2.6% p.a. 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 9.0% per year. Factoring in the forecast acceleration in revenue, it's pretty clear that BB Seguridade Participações is expected to grow much faster than its 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. Fortunately, analysts also upgraded their revenue estimates, and our data indicates sales are expected to perform better than the wider market. Given that analysts appear to be expecting substantial improvement in the sales pipeline, now could be the right time to take another look at BB Seguridade Participações.

Analysts are definitely bullish on BB Seguridade Participações, but no company is perfect. Indeed, you should know that there are several potential concerns to be aware of, including concerns around earnings quality. You can learn more, and discover the 1 other risk we've identified, for free on our platform here.

Of course, seeing company management invest large sums of money in a stock can be just as useful as knowing whether analysts are upgrading their estimates. So you may also wish to search this free list of stocks 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.