Analysts' Revenue Estimates For Montana Aerospace AG (VTX:AERO) Are Surging Higher

Celebrations may be in order for Montana Aerospace AG (VTX:AERO) shareholders, with the analysts delivering a significant upgrade to their statutory estimates for the company. The analysts have sharply increased their revenue numbers, with a view that Montana Aerospace will make substantially more sales than they'd previously expected. The market may be pricing in some blue sky too, with the share price gaining 12% to CHF18.48 in the last 7 days. We'll be curious to see if these new estimates convince the market to lift the stock price higher still.

Following the upgrade, the latest consensus from Montana Aerospace's three analysts is for revenues of €1.1b in 2022, which would reflect a major 78% improvement in sales compared to the last 12 months. The losses are expected to disappear over the next year or so, with forecasts for a profit of €0.76 per share this year. Previously, the analysts had been modelling revenues of €1.0b and earnings per share (EPS) of €0.99 in 2022. Although sales sentiment looks to be improving, the analysts have made a pretty serious decline to per-share earnings estimates, showing a sharp increase in pessimism recently.

View our latest analysis for Montana Aerospace

Analysts also cut Montana Aerospace's price target 16% to €35.99, implying that lower forecast earnings are expected to have a more negative impact than can be offset by the increase in sales. That's not the only conclusion we can draw from this data however, as some investors also like to consider the spread in estimates when evaluating analyst price targets. There are some variant perceptions on Montana Aerospace, with the most bullish analyst valuing it at €48.28 and the most bearish at €28.85 per share. This shows there is still some 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.

One way to get more context on these forecasts is to look at how they compare to both past performance, and how other companies in the same industry are performing. One thing stands out from these estimates, which is that Montana Aerospace is forecast to grow faster in the future than it has in the past, with revenues expected to display 78% annualised growth until the end of 2022. If achieved, this would be a much better result than the 12% annual decline over the past year. By contrast, our data suggests that other companies (with analyst coverage) in the industry are forecast to see their revenue grow 8.7% per year. Not only are Montana Aerospace's revenues expected to improve, it seems that the analysts are also expecting it to grow faster than the wider industry.

The Bottom Line

The most important thing to take away is that analysts cut their earnings per share estimates, expecting a clear decline in business conditions. Fortunately, analysts also upgraded their revenue estimates, and our data indicates sales are expected to perform better than the wider market. Furthermore, there was a cut to the price target, suggesting that the latest news has led to more pessimism about the intrinsic value of the business. Given that analysts appear to be expecting substantial improvement in the sales pipeline, now could be the right time to take another look at Montana Aerospace.

With that said, the long-term trajectory of the company's earnings is a lot more important than next year. At Simply Wall St, we have a full range of analyst estimates for Montana Aerospace going out to 2024, and you can see them 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.