Earnings Update: Zur Rose Group AG (VTX:ROSE) Just Reported And Analysts Are Trimming Their Forecasts

It's been a mediocre week for Zur Rose Group AG (VTX:ROSE) shareholders, with the stock dropping 19% to CHF330 in the week since its latest yearly results. Revenues were CHF1.5b, with Zur Rose Group reporting some 6.7% below analyst expectations. Following the result, the analysts have updated their earnings model, and it would be good to know whether they think there's been a strong change in the company's prospects, or if it's business as usual. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether the analysts have changed their mind on Zur Rose Group after the latest results.

Check out our latest analysis for Zur Rose Group

After the latest results, the nine analysts covering Zur Rose Group are now predicting revenues of CHF1.74b in 2021. If met, this would reflect a meaningful 18% improvement in sales compared to the last 12 months. Losses are expected to hold steady at around CHF10.03. Yet prior to the latest earnings, the analysts had been forecasting revenues of CHF1.96b and losses of CHF7.03 per share in 2021. So there's been quite a change-up of views after the recent consensus updates, withthe analysts making a serious cut to their revenue outlook while also expecting losses per share to increase.

The average price target was broadly unchanged at CHF462, perhaps implicitly signalling that the weaker earnings outlook is not expected to have a long-term impact on the valuation. 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 Zur Rose Group, with the most bullish analyst valuing it at CHF600 and the most bearish at CHF266 per share. This is a fairly broad spread of estimates, suggesting that analysts are forecasting a wide range of possible outcomes for the business.

Looking at the bigger picture now, one of the ways we can make sense of these forecasts is to see how they measure up against both past performance and industry growth estimates. The analysts are definitely expecting Zur Rose Group's growth to accelerate, with the forecast 18% annualised growth to the end of 2021 ranking favourably alongside historical growth of 13% per annum 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 3.6% per year. Factoring in the forecast acceleration in revenue, it's pretty clear that Zur Rose Group is expected to grow much faster than its industry.

The Bottom Line

The most important thing to take away is that the analysts increased their loss per share estimates for next year. Regrettably, they also downgraded their revenue estimates, but the latest forecasts still imply the business will grow faster than the wider industry. The consensus price target held steady at CHF462, with the latest estimates not enough to have an impact on their price targets.

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 Zur Rose Group going out to 2025, and you can see them free on our platform here..

However, before you get too enthused, we've discovered 2 warning signs for Zur Rose Group that you should be aware of.

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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.
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