Instone Real Estate Group AG (ETR:INS) Just Reported, And Analysts Assigned A €30.13 Price Target

The full-year results for Instone Real Estate Group AG (ETR:INS) were released last week, making it a good time to revisit its performance. Revenues came in 3.7% below expectations, at €464m. Statutory earnings per share were relatively better off, with a per-share profit of €0.81 being roughly in line with analyst estimates. Following the result, the analysts have updated their earnings model, and it would be good to know whether they think there's been a strong change in the company's prospects, or if it's business as usual. So we gathered the latest post-earnings forecasts to see what estimates suggest is in store for next year.

View our latest analysis for Instone Real Estate Group

After the latest results, the seven analysts covering Instone Real Estate Group are now predicting revenues of €898.1m in 2021. If met, this would reflect a sizeable 93% improvement in sales compared to the last 12 months. Per-share earnings are expected to jump 137% to €1.92. Yet prior to the latest earnings, the analysts had been anticipated revenues of €898.1m and earnings per share (EPS) of €2.04 in 2021. The analysts seem to have become a little more negative on the business after the latest results, given the small dip in their earnings per share numbers for next year.

The average price target fell 7.0% to €30.13, with reduced earnings forecasts clearly tied to a lower valuation estimate. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. There are some variant perceptions on Instone Real Estate Group, with the most bullish analyst valuing it at €36.00 and the most bearish at €25.90 per share. There are definitely some different views on the stock, but the range of estimates is not wide enough as to imply that the situation is unforecastable, in our view.

Looking at the bigger picture now, one of the ways we can make sense of these forecasts is to see how they measure up against both past performance and industry growth estimates. It's clear from the latest estimates that Instone Real Estate Group's rate of growth is expected to accelerate meaningfully, with the forecast 93% annualised revenue growth to the end of 2021 noticeably faster than its historical growth of 19% p.a. over the past five years. Compare this with other companies in the same industry, which are forecast to see a revenue decline of 7.2% annually. It seems obvious that as part of the brighter growth outlook, Instone Real Estate Group is expected to grow faster than the wider industry.

The Bottom Line

The biggest concern is that the analysts reduced their earnings per share estimates, suggesting business headwinds could lay ahead for Instone Real Estate Group. On the plus side, they made no changes to their revenue estimates - and they expect sales to perform better than the wider industry. The consensus price target fell measurably, with the analysts seemingly not reassured by the latest results, leading to a lower estimate of Instone Real Estate Group's future valuation.

With that said, the long-term trajectory of the company's earnings is a lot more important than next year. We have forecasts for Instone Real Estate Group going out to 2023, and you can see them free on our platform here.

You still need to take note of risks, for example - Instone Real Estate Group has 3 warning signs we think you should be aware of.

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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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