SIG Group AG Just Missed EPS By 34%: Here's What Analysts Think Will Happen Next

It's been a good week for SIG Group AG (VTX:SIGN) shareholders, because the company has just released its latest interim results, and the shares gained 5.9% to CHF24.34. Sales of €1.1b surpassed estimates by 5.2%, although statutory earnings per share missed badly, coming in 34% below expectations at €0.19 per share. This is an important time for investors, as they can track a company's performance in its report, look at what experts are forecasting for next year, and see if there has been any change to expectations for the business. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether the analysts have changed their mind on SIG Group after the latest results.

Check out our latest analysis for SIG Group

Following the latest results, SIG Group's nine analysts are now forecasting revenues of €2.62b in 2022. This would be a solid 17% improvement in sales compared to the last 12 months. Statutory earnings per share are predicted to soar 48% to €0.57. Yet prior to the latest earnings, the analysts had been anticipated revenues of €2.56b and earnings per share (EPS) of €0.50 in 2022. There's been a pretty noticeable increase in sentiment, with the analysts upgrading revenues and making a substantial gain in earnings per share in particular.

Althoughthe analysts have upgraded their earnings estimates, there was no change to the consensus price target of CHF24.75, suggesting that the forecast performance does not have a long term impact on the company's 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 SIG Group, with the most bullish analyst valuing it at CHF29.51 and the most bearish at CHF18.09 per share. Analysts definitely have varying views on the business, but the spread of estimates is not wide enough in our view to suggest that extreme outcomes could await SIG Group shareholders.

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the SIG Group's past performance and to peers in the same industry. The analysts are definitely expecting SIG Group's growth to accelerate, with the forecast 37% annualised growth to the end of 2022 ranking favourably alongside historical growth of 8.1% per annum over the past three years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to grow their revenue at 5.6% per year. It seems obvious that, while the growth outlook is brighter than the recent past, the analysts also expect SIG Group to grow faster than the wider industry.

The Bottom Line

The biggest takeaway for us is the consensus earnings per share upgrade, which suggests a clear improvement in sentiment around SIG Group's earnings potential next year. Pleasantly, they also upgraded their revenue estimates, and their forecasts suggest the business is expected to grow faster than the wider industry. The consensus price target held steady at CHF24.75, with the latest estimates not enough to have an impact on their price targets.

Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. At Simply Wall St, we have a full range of analyst estimates for SIG Group going out to 2024, and you can see them free on our platform here..

You should always think about risks though. Case in point, we've spotted 2 warning signs for SIG Group you should be aware of, and 1 of them makes us a bit uncomfortable.

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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.