Upgrade: Analysts Just Made A Sizeable Increase To Their Romande Energie Holding SA (VTX:REHN) Forecasts

Romande Energie Holding SA (VTX:REHN) shareholders will have a reason to smile today, with the analysts making substantial upgrades to this year's statutory 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 this upgrade, Romande Energie Holding's two analysts are forecasting 2023 revenues to be CHF871m, approximately in line with the last 12 months. Statutory earnings per share are anticipated to crater 26% to CHF6.70 in the same period. Previously, the analysts had been modelling revenues of CHF778m and earnings per share (EPS) of CHF3.35 in 2023. 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 Romande Energie Holding

Although the analysts have upgraded their earnings estimates, there was no change to the consensus price target of CHF65.00, suggesting that the forecast performance does not have a long term impact on the company's valuation.

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. We would highlight that sales are expected to reverse, with a forecast 0.5% annualised revenue decline to the end of 2023. That is a notable change from historical growth of 6.9% over the last five years. By contrast, our data suggests that other companies (with analyst coverage) in the industry are forecast to see their revenue decline 4.2% annually for the foreseeable future. The forecasts do look comparatively optimistic for Romande Energie Holding, since they're expecting it to shrink slower than the 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 our data indicates sales are expected to perform better 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 Romande Energie Holding could be a good candidate for more research.

Still, the long-term prospects of the business are much more relevant than next year's earnings. At least one analyst has provided forecasts out to 2025, which can be seen for 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. 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.