Analysts Are Betting On Medios AG (ETR:ILM1) With A Big Upgrade This Week

Medios AG (ETR:ILM1) shareholders will have a reason to smile today, with the analysts making substantial upgrades to next year's statutory forecasts. The consensus estimated revenue numbers rose, with their view now clearly much more bullish on the company's business prospects.

Following the upgrade, the latest consensus from Medios' three analysts is for revenues of €1.1b in 2021, which would reflect a huge 78% improvement in sales compared to the last 12 months. Statutory earnings per share are presumed to bounce 152% to €1.01. Previously, the analysts had been modelling revenues of €937m and earnings per share (EPS) of €1.00 in 2021. There's clearly been a surge in bullishness around the company's sales pipeline, even if there's no real change in earnings per share forecasts.

View our latest analysis for Medios

The consensus price target increased 11% to €43.00, with an improved revenue forecast carrying the promise of a more valuable business, in time. Fixating on a single price target can be unwise though, since the consensus target is effectively the average of analyst price targets. As a result, some investors like to look at the range of estimates to see if there are any diverging opinions on the company's valuation. The most optimistic Medios analyst has a price target of €49.00 per share, while the most pessimistic values it at €38.00. Still, with such a tight range of estimates, it suggests the analysts have a pretty good idea of what they think the company is worth.

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 Medios' rate of growth is expected to accelerate meaningfully, with the forecast 78% revenue growth noticeably faster than its historical growth of 36% p.a. over the past five years. Compare this with other companies in the same industry, which are forecast to grow their revenue 5.4% next year. Factoring in the forecast acceleration in revenue, it's pretty clear that Medios is expected to grow much faster than its industry.

The Bottom Line

The most important thing to take away is that there's been no major change in sentiment, with analysts reconfirming that earnings per share are expected to continue performing in line with their prior expectations. They also upgraded their revenue estimates for next year, and sales are expected to grow faster than the wider market. There was also a nice increase in the price target, with analysts apparently feeling that the intrinsic value of the business is improving. Given that analysts appear to be expecting substantial improvement in the sales pipeline, now could be the right time to take another look at Medios.

With that said, the long-term trajectory of the company's earnings is a lot more important than next year. At Simply Wall St, we have a full range of analyst estimates for Medios going out to 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 upgrading 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. 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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