CompuGroup Medical SE & Co. KGaA (ETR:COP) Just Reported Earnings, And Analysts Cut Their Target Price

The first-quarter results for CompuGroup Medical SE & Co. KGaA (ETR:COP) were released last week, making it a good time to revisit its performance. Results look mixed - while revenue fell marginally short of analyst estimates at €285m, statutory earnings were in line with expectations, at €0.88 per share. Earnings are an important time for investors, as they can track a company's performance, look at what the analysts are forecasting for next year, and see if there's been a change in sentiment towards the company. With this in mind, we've gathered the latest statutory forecasts to see what the analysts are expecting for next year.

Check out our latest analysis for CompuGroup Medical SE KGaA

Following last week's earnings report, CompuGroup Medical SE KGaA's ten analysts are forecasting 2024 revenues to be €1.19b, approximately in line with the last 12 months. Per-share earnings are expected to leap 67% to €1.05. Yet prior to the latest earnings, the analysts had been anticipated revenues of €1.24b and earnings per share (EPS) of €1.65 in 2024. From this we can that sentiment has definitely become more bearish after the latest results, leading to lower revenue forecasts and a pretty serious reduction to earnings per share estimates.

The consensus price target fell 30% to €29.95, with the weaker earnings outlook clearly leading valuation estimates. 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 CompuGroup Medical SE KGaA at €64.00 per share, while the most bearish prices it at €16.00. So we wouldn't be assigning too much credibility to analyst price targets in this case, because there are clearly some widely different views on what kind of performance this business can generate. As a result it might not be a great idea to make decisions based on the consensus price target, which is after all just an average of this wide range of estimates.

Of course, another way to look at these forecasts is to place them into context against the industry itself. These estimates imply that revenue is expected to slow, with a forecast annualised decline of 0.8% by the end of 2024. This indicates a significant reduction from annual growth of 12% over the last five years. Compare this with our data, which suggests that other companies in the same industry are, in aggregate, expected to see their revenue grow 11% per year. So although its revenues are forecast to shrink, this cloud does not come with a silver lining - CompuGroup Medical SE KGaA is expected to lag 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. On the negative side, they also downgraded their revenue estimates, and forecasts imply they will perform worse than the wider industry. Furthermore, the analysts also cut their price targets, suggesting that the latest news has led to greater pessimism about the intrinsic value of the business.

With that in mind, we wouldn't be too quick to come to a conclusion on CompuGroup Medical SE KGaA. Long-term earnings power is much more important than next year's profits. We have estimates - from multiple CompuGroup Medical SE KGaA analysts - going out to 2026, and you can see them free on our platform here.

And what about risks? Every company has them, and we've spotted 4 warning signs for CompuGroup Medical SE KGaA (of which 1 is a bit concerning!) 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.

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