The Consensus EPS Estimates For Leonteq AG (VTX:LEON) Just Fell Dramatically

Market forces rained on the parade of Leonteq AG (VTX:LEON) shareholders today, when the analysts downgraded their forecasts for this year. Both revenue and earnings per share (EPS) forecasts went under the knife, suggesting the analysts have soured majorly on the business.

Following the downgrade, the current consensus from Leonteq's two analysts is for revenues of CHF258m in 2025 which - if met - would reflect a solid 8.6% increase on its sales over the past 12 months. Per-share earnings are expected to surge 366% to CHF1.56. Prior to this update, the analysts had been forecasting revenues of CHF289m and earnings per share (EPS) of CHF2.57 in 2025. Indeed, we can see that the analysts are a lot more bearish about Leonteq's prospects, administering a measurable cut to revenue estimates and slashing their EPS estimates to boot.

Check out our latest analysis for Leonteq

It'll come as no surprise then, to learn that the analysts have cut their price target 19% to CHF17.00.

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Leonteq's past performance and to peers in the same industry. One thing stands out from these estimates, which is that Leonteq is forecast to grow faster in the future than it has in the past, with revenues expected to display 8.6% annualised growth until the end of 2025. If achieved, this would be a much better result than the 0.05% annual decline over the past five years. Compare this against analyst estimates for the broader industry, which suggest that (in aggregate) industry revenues are expected to grow 5.4% annually. So it looks like Leonteq is expected to grow faster than its competitors, at least for a while.

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. While analysts did downgrade their revenue estimates, these forecasts still imply revenues will perform better than the wider market. After such a stark change in sentiment from analysts, we'd understand if readers now felt a bit wary of Leonteq.

After a downgrade like this, it's pretty clear that previous forecasts were too optimistic. What's more, we've spotted several possible issues with Leonteq's business, like its declining profit margins. For more information, you can click here to discover this and the 3 other risks we've identified.

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

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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.