The Consensus EPS Estimates For pferdewetten.de AG (ETR:EMH) Just Fell A Lot

Today is shaping up negative for pferdewetten.de AG (ETR:EMH) shareholders, with the analysts delivering a substantial negative revision to this year's forecasts. Both revenue and earnings per share (EPS) forecasts went under the knife, suggesting the analysts have soured majorly on the business.

After this downgrade, pferdewetten.de's dual analysts are now forecasting revenues of €20m in 2022. This would be a huge 20% improvement in sales compared to the last 12 months. Following this this downgrade, earnings are now expected to tip over into loss-making territory, with the analysts forecasting losses of €0.17 per share in 2022. Before this latest update, the analysts had been forecasting revenues of €28m and earnings per share (EPS) of €0.11 in 2022. So we can see that the consensus has become notably more bearish on pferdewetten.de's outlook with these numbers, making a sizeable cut to this year's revenue estimates. Furthermore, they expect the business to be loss-making this year, compared to their previous forecasts of a profit.

See our latest analysis for pferdewetten.de

There was no major change to the consensus price target of €24.00, signalling that the business is performing roughly in line with expectations, despite lower earnings per share forecasts. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. Currently, the most bullish analyst values pferdewetten.de at €28.00 per share, while the most bearish prices it at €20.00. 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.

Another way we can view these estimates is in the context of the bigger picture, such as how the forecasts stack up against past performance, and whether forecasts are more or less bullish relative to other companies in the industry. We can infer from the latest estimates that forecasts expect a continuation of pferdewetten.de'shistorical trends, as the 20% annualised revenue growth to the end of 2022 is roughly in line with the 19% annual revenue growth over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to see their revenues grow 12% per year. So it's pretty clear that pferdewetten.de is forecast to grow substantially faster than its industry.

The Bottom Line

The biggest low-light for us was that the forecasts for pferdewetten.de dropped from profits to a loss this year. Unfortunately, analysts also downgraded their revenue estimates, although our data indicates revenues are expected to perform better than the wider market. The lack of change in the price target is puzzling in light of the downgrade but, with a serious decline expected this year, we wouldn't be surprised if investors were a bit wary of pferdewetten.de.

With that said, the long-term trajectory of the company's earnings is a lot more important than next year. We have analyst estimates for pferdewetten.de going out as far as 2024, 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 downgrading 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.