Evonik Industries AG Just Beat Analyst Forecasts, And Analysts Have Been Updating Their Predictions

It's been a good week for Evonik Industries AG (ETR:EVK) shareholders, because the company has just released its latest first-quarter results, and the shares gained 2.7% to €20.31. Revenues of €3.8b fell slightly short of expectations, but earnings were a definite bright spot, with statutory per-share profits of €0.33 an impressive 97% ahead of estimates. 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. We thought readers would find it interesting to see the analysts latest (statutory) post-earnings forecasts for next year.

View our latest analysis for Evonik Industries

Taking into account the latest results, the current consensus from Evonik Industries' 16 analysts is for revenues of €15.4b in 2024. This would reflect a modest 2.0% increase on its revenue over the past 12 months. Earnings are expected to improve, with Evonik Industries forecast to report a statutory profit of €1.02 per share. Before this earnings report, the analysts had been forecasting revenues of €15.4b and earnings per share (EPS) of €0.90 in 2024. Although the revenue estimates have not really changed, we can see there's been a nice increase in earnings per share expectations, suggesting that the analysts have become more bullish after the latest result.

The consensus price target was unchanged at €21.14, implying that the improved earnings outlook is not expected to have a long term impact on value creation for shareholders. 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 Evonik Industries at €25.00 per share, while the most bearish prices it at €17.00. As you can see, analysts are not all in agreement on the stock's future, but the range of estimates is still reasonably narrow, which could suggest that the outcome is not totally unpredictable.

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. It's pretty clear that there is an expectation that Evonik Industries' revenue growth will slow down substantially, with revenues to the end of 2024 expected to display 2.7% growth on an annualised basis. This is compared to a historical growth rate of 6.9% over the past five years. By way of comparison, the other companies in this industry with analyst coverage are forecast to grow their revenue at 4.2% per year. So it's pretty clear that, while revenue growth is expected to slow down, the wider industry is also expected to grow faster than Evonik Industries.

The Bottom Line

The most important thing here is that the analysts upgraded their earnings per share estimates, suggesting that there has been a clear increase in optimism towards Evonik Industries following these results. Fortunately, the analysts also reconfirmed their revenue estimates, suggesting that it's tracking in line with expectations. Although our data does suggest that Evonik Industries' revenue is expected to perform worse than the wider industry. The consensus price target held steady at €21.14, with the latest estimates not enough to have an impact on their price targets.

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 Evonik Industries going out to 2026, and you can see them free on our platform here..

Even so, be aware that Evonik Industries 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.