Brokers Are Upgrading Their Views On Sensirion Holding AG (VTX:SENS) With These New Forecasts

Sensirion Holding AG (VTX:SENS) shareholders will have a reason to smile today, with the analysts making substantial upgrades to this year's forecasts. The analysts greatly increased their revenue estimates, suggesting a stark improvement in business fundamentals. Sensirion Holding has also found favour with investors, with the stock up a noteworthy 20% to CHF68.00 over the past week. We'll be curious to see if these new estimates convince the market to lift the stock price higher still.

Following the latest upgrade, the three analysts covering Sensirion Holding provided consensus estimates of CHF234m revenue in 2021, which would reflect a discernible 7.6% decline on its sales over the past 12 months. Statutory earnings per share are supposed to nosedive 48% to CHF1.40 in the same period. Prior to this update, the analysts had been forecasting revenues of CHF208m and earnings per share (EPS) of CHF1.24 in 2021. 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.

See our latest analysis for Sensirion Holding

With these upgrades, we're not surprised to see that the analysts have lifted their price target 7.5% to CHF59.83 per share. 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. There are some variant perceptions on Sensirion Holding, with the most bullish analyst valuing it at CHF72.50 and the most bearish at CHF37.00 per share. 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.

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. We would highlight that sales are expected to reverse, with a forecast 7.6% annualised revenue decline to the end of 2021. That is a notable change from historical growth of 14% over the last three years. Compare this with our data, which suggests that other companies in the same industry are, in aggregate, expected to see their revenue grow 8.3% per year. So although its revenues are forecast to shrink, this cloud does not come with a silver lining - Sensirion Holding is expected to lag 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. Fortunately, they also upgraded their revenue estimates, and are forecasting revenues to grow slower than the wider market. Given that the consensus looks almost universally bullish, with a substantial increase to forecasts and a higher price target, Sensirion Holding could be worth investigating further.

Still, the long-term prospects of the business are much more relevant than next year's earnings. At Simply Wall St, we have a full range of analyst estimates for Sensirion Holding going out to 2025, and you can see them free on our platform here..

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

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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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