Results: 3U Holding AG Exceeded Expectations And The Consensus Has Updated Its Estimates

Investors in 3U Holding AG (ETR:UUU) had a good week, as its shares rose 5.3% to close at €1.84 following the release of its yearly results. Revenues were €52m, approximately in line with expectations, although statutory earnings per share (EPS) performed substantially better. EPS of €0.07 were also better than expected, beating analyst predictions by 17%. The analysts typically update their forecasts at each earnings report, and we can judge from their estimates whether their view of the company has changed or if there are any new concerns to be aware of. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether the analysts have changed their mind on 3U Holding after the latest results.

View our latest analysis for 3U Holding

Taking into account the latest results, the current consensus from 3U Holding's three analysts is for revenues of €58.7m in 2024. This would reflect a solid 12% increase on its revenue over the past 12 months. Statutory earnings per share are forecast to plunge 93% to €0.005 in the same period. Yet prior to the latest earnings, the analysts had been anticipated revenues of €59.2m and earnings per share (EPS) of €0.04 in 2024. So there's definitely been a decline in sentiment after the latest results, noting the pretty serious reduction to new EPS forecasts.

It might be a surprise to learn that the consensus price target was broadly unchanged at €3.10, with the analysts clearly implying that the forecast decline in earnings is not expected to have much of an impact on 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. The most optimistic 3U Holding analyst has a price target of €3.50 per share, while the most pessimistic values it at €2.70. Even so, with a relatively close grouping of estimates, it looks like the analysts are quite confident in their valuations, suggesting 3U Holding is an easy business to forecast or the the analysts are all using similar assumptions.

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. It's clear from the latest estimates that 3U Holding's rate of growth is expected to accelerate meaningfully, with the forecast 12% annualised revenue growth to the end of 2024 noticeably faster than its historical growth of 1.7% p.a. over the past five years. Compare this with other companies in the same industry, which are forecast to grow their revenue 5.1% annually. It seems obvious that, while the growth outlook is brighter than the recent past, the analysts also expect 3U Holding to grow faster than the wider industry.

The Bottom Line

The most important thing to take away is that the analysts downgraded their earnings per share estimates, showing that there has been a clear decline in sentiment following these results. Fortunately, they also reconfirmed their revenue numbers, suggesting that it's tracking in line with expectations. Additionally, our data suggests that revenue is expected to grow faster than the wider industry. There was no real change to the consensus price target, suggesting that the intrinsic value of the business has not undergone any major changes with the latest estimates.

Following on from that line of thought, we think that the long-term prospects of the business are much more relevant than next year's earnings. We have forecasts for 3U Holding going out to 2026, and you can see them free on our platform here.

We don't want to rain on the parade too much, but we did also find 2 warning signs for 3U Holding that you need to be mindful of.

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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.