This Broker Just Slashed Their Francotyp-Postalia Holding AG (ETR:FPH) Earnings Forecasts

Market forces rained on the parade of Francotyp-Postalia Holding AG (ETR:FPH) shareholders today, when the covering analyst downgraded their forecasts for this year. Both revenue and earnings per share (EPS) estimates were cut sharply as the analyst factored in the latest outlook for the business, concluding that they were too optimistic previously.

Following the latest downgrade, the current consensus, from the solitary analyst covering Francotyp-Postalia Holding, is for revenues of €167m in 2024, which would reflect a substantial 31% reduction in Francotyp-Postalia Holding's sales over the past 12 months. Statutory earnings per share are anticipated to tumble 52% to €0.38 in the same period. Prior to this update, the analyst had been forecasting revenues of €228m and earnings per share (EPS) of €0.59 in 2024. Indeed, we can see that the analyst is a lot more bearish about Francotyp-Postalia Holding's prospects, administering a sizeable cut to revenue estimates and slashing their EPS estimates to boot.

See our latest analysis for Francotyp-Postalia Holding

The consensus price target fell 12% to €5.10, with the weaker earnings outlook clearly leading analyst valuation estimates.

Of course, another way to look at these forecasts is to place them into context against the industry itself. These estimates imply that sales are expected to slow, with a forecast annualised revenue decline of 31% by the end of 2024. This indicates a significant reduction from annual growth of 3.9% over the last five years. By contrast, our data suggests that other companies (with analyst coverage) in the same industry are forecast to see their revenue grow 5.0% annually for the foreseeable future. So although its revenues are forecast to shrink, this cloud does not come with a silver lining - Francotyp-Postalia Holding is expected to lag the wider industry.

The Bottom Line

The most important thing to take away is that the analyst cut their earnings per share estimates, expecting a clear decline in business conditions. Unfortunately the analyst also downgraded their revenue estimates, and industry data suggests that Francotyp-Postalia Holding's revenues are expected to grow slower than the wider market. With a serious cut to this year's expectations and a falling price target, we wouldn't be surprised if investors were becoming wary of Francotyp-Postalia Holding.

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.

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 backed by insiders.

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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.