Analysts Are More Bearish On Patrizia AG (ETR:PAT) Than They Used To Be

One thing we could say about the analysts on Patrizia AG (ETR:PAT) - they aren't optimistic, having just made a major negative revision to their near-term (statutory) forecasts for the organization. Revenue and earnings per share (EPS) forecasts were both revised downwards, with the analysts seeing grey clouds on the horizon.

Following the downgrade, the latest consensus from Patrizia's four analysts is for revenues of €371m in 2022, which would reflect a solid 8.9% improvement in sales compared to the last 12 months. Per-share earnings are expected to accumulate 3.0% to €0.53. Before this latest update, the analysts had been forecasting revenues of €413m and earnings per share (EPS) of €0.68 in 2022. Indeed, we can see that the analysts are a lot more bearish about Patrizia's prospects, administering a measurable cut to revenue estimates and slashing their EPS estimates to boot.

Check out our latest analysis for Patrizia

It'll come as no surprise then, to learn that the analysts have cut their price target 7.8% to €24.08. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. The most optimistic Patrizia analyst has a price target of €26.00 per share, while the most pessimistic values it at €21.80. 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.

Of course, another way to look at these forecasts is to place them into context against the industry itself. It's clear from the latest estimates that Patrizia's rate of growth is expected to accelerate meaningfully, with the forecast 12% annualised revenue growth to the end of 2022 noticeably faster than its historical growth of 0.2% p.a. over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in the same industry are forecast to see their revenue shrink 11% per year. It seems obvious that as part of the brighter growth outlook, Patrizia is expected to grow faster than the wider industry.

The Bottom Line

The most important thing to take away is that analysts cut their earnings per share estimates, expecting a clear decline in business conditions. Unfortunately, they also downgraded their revenue estimates, and our data indicates sales are expected to outperform the wider market. Even so, earnings per share are more important to the intrinsic value of the business. Given the scope of the downgrades, it would not be a surprise to see the market become more wary of the business.

With that said, the long-term trajectory of the company's earnings is a lot more important than next year. We have estimates - from multiple Patrizia analysts - going out to 2024, and you can see them free on our platform here.

Another way to search for interesting companies that could be reaching an inflection point is to track whether management are buying or selling, with our free list of growing companies that insiders are buying.

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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.