Bullish: Analysts Just Made A Significant Upgrade To Their SIG Combibloc Group AG (VTX:SIGN) Forecasts

Shareholders in SIG Combibloc Group AG (VTX:SIGN) may be thrilled to learn that the analysts have just delivered a major upgrade to their near-term forecasts. Consensus estimates suggest investors could expect greatly increased statutory revenues and earnings per share, with analysts modelling a real improvement in business performance.

Following the upgrade, the current consensus from SIG Combibloc Group's eight analysts is for revenues of €2.6b in 2022 which - if met - would reflect a major 26% increase on its sales over the past 12 months. Statutory earnings per share are forecast to be €0.51, approximately in line with the last 12 months. Before this latest update, the analysts had been forecasting revenues of €2.2b and earnings per share (EPS) of €0.43 in 2022. So we can see there's been a pretty clear increase in analyst sentiment in recent times, with both revenues and earnings per share receiving a decent lift in the latest estimates.

View our latest analysis for SIG Combibloc Group

Although the analysts have upgraded their earnings estimates, there was no change to the consensus price target of €24.28, suggesting that the forecast performance does not have a long term impact on the company's valuation. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. Currently, the most bullish analyst values SIG Combibloc Group at €29.77 per share, while the most bearish prices it at €18.51. These price targets show that analysts do have some differing views on the business, but the estimates do not vary enough to suggest to us that some are betting on wild success or utter failure.

Of course, another way to look at these forecasts is to place them into context against the industry itself. It's clear from the latest estimates that SIG Combibloc Group's rate of growth is expected to accelerate meaningfully, with the forecast 26% annualised revenue growth to the end of 2022 noticeably faster than its historical growth of 4.0% p.a. 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 5.4% per year. It seems obvious that, while the growth outlook is brighter than the recent past, the analysts also expect SIG Combibloc Group to grow faster than the wider industry.

The Bottom Line

The most important thing to take away from this upgrade is that analysts upgraded their earnings per share estimates for this year, expecting improving business conditions. Fortunately, analysts also upgraded their revenue estimates, and our data indicates sales are expected to perform better than the wider market. The lack of change in the price target is puzzling, but with a serious upgrade to this year's earnings expectations, it might be time to take another look at SIG Combibloc Group.

Analysts are definitely bullish on SIG Combibloc Group, but no company is perfect. Indeed, you should know that there are several potential concerns to be aware of, including a weak balance sheet. For more information, you can click through to our platform to learn more about this and the 3 other flags we've identified .

Another thing to consider is whether management and directors have been buying or selling stock recently. We provide an overview of all open market stock trades for the last twelve months on our platform, here.

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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.