ZEAL Network SE Just Beat Revenue Estimates By 6.9%

It's been a good week for ZEAL Network SE (ETR:TIMA) shareholders, because the company has just released its latest second-quarter results, and the shares gained 2.8% to €37.10. It was a workmanlike result, with revenues of €41m coming in 6.9% ahead of expectations, and statutory earnings per share of €0.59, in line with analyst appraisals. 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. So we gathered the latest post-earnings forecasts to see what estimates suggest is in store for next year.

See our latest analysis for ZEAL Network

Taking into account the latest results, the consensus forecast from ZEAL Network's four analysts is for revenues of €152.4m in 2024. This reflects a decent 11% improvement in revenue compared to the last 12 months. Statutory earnings per share are expected to plummet 53% to €0.95 in the same period. In the lead-up to this report, the analysts had been modelling revenues of €149.0m and earnings per share (EPS) of €1.18 in 2024. While next year's revenue estimates increased, there was also a real cut to EPS expectations, suggesting the consensus has a bit of a mixed view of these results.

There's been no major changes to the price target of €51.10, suggesting that the impact of higher forecast revenue and lower earnings won't result in a meaningful change to the business' valuation. 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 ZEAL Network at €59.00 per share, while the most bearish prices it at €45.00. Even so, with a relatively close grouping of estimates, it looks like the analysts are quite confident in their valuations, suggesting ZEAL Network 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 ZEAL Network's rate of growth is expected to accelerate meaningfully, with the forecast 22% annualised revenue growth to the end of 2024 noticeably faster than its historical growth of 1.3% p.a. over the past five years. Compare this with other companies in the same industry, which are forecast to grow their revenue 9.9% annually. It seems obvious that, while the growth outlook is brighter than the recent past, the analysts also expect ZEAL Network 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. Happily, they also upgraded their revenue estimates, and are forecasting them 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.

With that said, the long-term trajectory of the company's earnings is a lot more important than next year. We have forecasts for ZEAL Network going out to 2026, and you can see them free on our platform here.

Even so, be aware that ZEAL Network is showing 1 warning sign in our investment analysis , you should know about...

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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.