Lojas Renner S.A. (BVMF:LREN3) Annual Results Just Came Out: Here's What Analysts Are Forecasting For This Year

It's been a sad week for Lojas Renner S.A. (BVMF:LREN3), who've watched their investment drop 14% to R$11.79 in the week since the company reported its full-year result. It was an okay result overall, with revenues coming in at R$14b, roughly what the analysts had been expecting. 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. We thought readers would find it interesting to see the analysts latest (statutory) post-earnings forecasts for next year.

Check out our latest analysis for Lojas Renner

Taking into account the latest results, the consensus forecast from Lojas Renner's ten analysts is for revenues of R$15.7b in 2025. This reflects a solid 8.8% improvement in revenue compared to the last 12 months. Statutory earnings per share are predicted to surge 34% to R$1.39. Before this earnings report, the analysts had been forecasting revenues of R$15.8b and earnings per share (EPS) of R$1.49 in 2025. So it looks like there's been a small decline in overall sentiment after the recent results - there's been no major change to revenue estimates, but the analysts did make a minor downgrade to their earnings per share forecasts.

The consensus price target held steady at R$18.61, with the analysts seemingly voting that their lower forecast earnings are not expected to lead to a lower stock price in the foreseeable future. There's another way to think about price targets though, and that's to look at the range of price targets put forward by analysts, because a wide range of estimates could suggest a diverse view on possible outcomes for the business. The most optimistic Lojas Renner analyst has a price target of R$22.73 per share, while the most pessimistic values it at R$15.00. As you can see, analysts are not all in agreement on the stock's future, but the range of estimates is still reasonably narrow, which could suggest that the outcome is not totally unpredictable.

Taking a look at the bigger picture now, one of the ways we can understand these forecasts is to see how they compare to both past performance and industry growth estimates. We would highlight that Lojas Renner's revenue growth is expected to slow, with the forecast 8.8% annualised growth rate until the end of 2025 being well below the historical 13% p.a. growth over the last five years. Juxtapose this against the other companies in the industry with analyst coverage, which are forecast to grow their revenues (in aggregate) 4.5% per year. Even after the forecast slowdown in growth, it seems obvious that Lojas Renner is also expected to grow faster than the wider industry.

The Bottom Line

The biggest concern is that the analysts reduced their earnings per share estimates, suggesting business headwinds could lay ahead for Lojas Renner. Fortunately, they also reconfirmed their revenue numbers, suggesting that it's tracking in line with expectations. Additionally, our data suggests that revenue is expected to grow faster than the wider industry. There was no real change to the consensus price target, suggesting that the intrinsic value of the business has not undergone any major changes with the latest estimates.

With that said, the long-term trajectory of the company's earnings is a lot more important than next year. We have forecasts for Lojas Renner going out to 2027, and you can see them free on our platform here.

And what about risks? Every company has them, and we've spotted 2 warning signs for Lojas Renner you should know about.

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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.