This Just In: Analysts Are Boosting Their Ringmetall SE (ETR:HP3A) Outlook for This Year

Celebrations may be in order for Ringmetall SE (ETR:HP3A) shareholders, with the analysts delivering a significant upgrade to their statutory estimates for the company. 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. The market may be pricing in some blue sky too, with the share price gaining 13% to €3.63 in the last 7 days. It will be interesting to see if today's upgrade is enough to propel the stock even higher.

Following the upgrade, the most recent consensus for Ringmetall from its three analysts is for revenues of €158m in 2021 which, if met, would be a substantial 34% increase on its sales over the past 12 months. Statutory earnings per share are presumed to bounce 245% to €0.28. Before this latest update, the analysts had been forecasting revenues of €142m and earnings per share (EPS) of €0.19 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.

Check out our latest analysis for Ringmetall

It will come as no surprise to learn that the analysts have increased their price target for Ringmetall 17% to €5.03 on the back of these upgrades. The consensus price target is just an average of individual analyst targets, so - it could be handy to see how wide the range of underlying estimates is. Currently, the most bullish analyst values Ringmetall at €5.20 per share, while the most bearish prices it at €4.10. This is a very narrow spread of estimates, implying either that Ringmetall is an easy company to value, or - more likely - the analysts are relying heavily on some key assumptions.

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Ringmetall's past performance and to peers in the same industry. The analysts are definitely expecting Ringmetall's growth to accelerate, with the forecast 34% annualised growth to the end of 2021 ranking favourably alongside historical growth of 9.3% per annum 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 6.0% per year. It seems obvious that, while the growth outlook is brighter than the recent past, the analysts also expect Ringmetall 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. They also upgraded their revenue estimates for this year, and sales are expected to grow faster than the wider market. Given that the consensus looks almost universally bullish, with a substantial increase to forecasts and a higher price target, Ringmetall could be worth investigating further.

With that said, the long-term trajectory of the company's earnings is a lot more important than next year. We have estimates - from multiple Ringmetall analysts - going out to 2023, and you can see them free on our platform here.

You can also see our analysis of Ringmetall's Board and CEO remuneration and experience, and whether company insiders have been buying stock.

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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.
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