Party Time: Brokers Just Made Major Increases To Their Swiss Prime Site AG (VTX:SPSN) Earnings Forecasts

Shareholders in Swiss Prime Site AG (VTX:SPSN) may be thrilled to learn that the analysts have just delivered a major upgrade to their near-term forecasts. The consensus statutory numbers for both revenue and earnings per share (EPS) increased, with their view clearly much more bullish on the company's business prospects.

Following the upgrade, the current consensus from Swiss Prime Site's four analysts is for revenues of CHF911m in 2022 which - if met - would reflect a solid 20% increase on its sales over the past 12 months. Statutory earnings per share are anticipated to crater 26% to CHF5.05 in the same period. Previously, the analysts had been modelling revenues of CHF780m and earnings per share (EPS) of CHF4.59 in 2022. There has definitely been an improvement in perception recently, with the analysts substantially increasing both their earnings and revenue estimates.

Check out our latest analysis for Swiss Prime Site

Although the analysts have upgraded their earnings estimates, there was no change to the consensus price target of CHF94.67, suggesting that the forecast performance does not have a long term impact on the company's valuation. There's another way to think about price targets though, and that's to look at the range of price targets put forward by analysts, because a wide range of estimates could suggest a diverse view on possible outcomes for the business. Currently, the most bullish analyst values Swiss Prime Site at CHF102 per share, while the most bearish prices it at CHF82.00. With such a narrow range of valuations, analysts apparently share similar views on what they think the business is worth.

Taking a look at the bigger picture now, one of the ways we can understand these forecasts is to see how they compare to both past performance and industry growth estimates. One thing stands out from these estimates, which is that Swiss Prime Site is forecast to grow faster in the future than it has in the past, with revenues expected to display 20% annualised growth until the end of 2022. If achieved, this would be a much better result than the 8.4% annual decline over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in the industry are forecast to see their revenue grow 0.3% per year. Not only are Swiss Prime Site'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 biggest takeaway for us from these new estimates is that analysts upgraded their earnings per share estimates, with improved earnings power expected for this year. They also upgraded their revenue estimates for this year, and sales are expected to grow faster than the wider market. Some investors might be disappointed to see that the price target is unchanged, but we feel that improving fundamentals are usually a positive - assuming these forecasts are met! So Swiss Prime Site could be a good candidate for more research.

Even so, the longer term trajectory of the business is much more important for the value creation of shareholders. At Simply Wall St, we have a full range of analyst estimates for Swiss Prime Site going out to 2024, and you can see them free on our platform here..

Another way to search for interesting companies that could be reaching an inflection point is to track whether management are buying or selling, with our free list of growing companies that insiders are buying.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

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.