Earnings Update: Here's Why Analysts Just Lifted Their Banque Cantonale Vaudoise (VTX:BCVN) Price Target To CHF74.00

Banque Cantonale Vaudoise (VTX:BCVN) 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. The result was positive overall - although revenues of CHF945m were in line with what the analysts predicted, Banque Cantonale Vaudoise surprised by delivering a statutory profit of CHF3.84 per share, modestly greater than expected. 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 collected the latest post-earnings statutory consensus estimates to see what could be in store for next year.

See our latest analysis for Banque Cantonale Vaudoise

Taking into account the latest results, Banque Cantonale Vaudoise's two analysts currently expect revenues in 2021 to be CHF962.9m, approximately in line with the last 12 months. Statutory earnings per share are expected to dip 8.3% to CHF3.88 in the same period. In the lead-up to this report, the analysts had been modelling revenues of CHF974.4m and earnings per share (EPS) of CHF3.91 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.

The consensus price target rose 5.7% to CHF74.00despite there being no meaningful change to earnings estimates. It could be that the analystsare reflecting the predictability of Banque Cantonale Vaudoise's earnings by assigning a price premium.

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Banque Cantonale Vaudoise's past performance and to peers in the same industry. From these estimates it looks as though the analysts expect the years of declining sales to come to an end, given the flat revenue forecast for next year. That would be a definite improvement, given that the past five years have seen sales shrink five years annually. Compare this against analyst estimates for the wider industry, which suggest that (in aggregate) industry revenues are expected to grow 2.7% next year. So it's pretty clear that, although revenues are improving, Banque Cantonale Vaudoise is still expected to grow slower than the 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 Banque Cantonale Vaudoise's revenues are expected to perform worse than the wider industry. We note an upgrade to the price target, suggesting that the analysts believes the intrinsic value of the business is likely to improve over time.

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 analyst estimates for Banque Cantonale Vaudoise going out as far as 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 1 warning sign for Banque Cantonale Vaudoise that you should be aware of.

When trading Banque Cantonale Vaudoise or any other investment, use the platform considered by many to be the Professional's Gateway to the Worlds Market, Interactive Brokers. You get the lowest-cost* trading on stocks, options, futures, forex, bonds and funds worldwide from a single integrated account. Promoted

This article by Simply Wall St is general in nature. 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.
^*Interactive Brokers Rated Lowest Cost Broker by StockBrokers.com Annual Online Review 2020

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.