Some Analysts Just Cut Their Bechtle AG (ETR:BC8) Estimates

The latest analyst coverage could presage a bad day for Bechtle AG (ETR:BC8), with the analysts making across-the-board cuts to their statutory estimates that might leave shareholders a little shell-shocked. Revenue estimates were cut sharply as the analysts signalled a weaker outlook - perhaps a sign that investors should temper their expectations as well.

Following the downgrade, the most recent consensus for Bechtle from its ten analysts is for revenues of €6.1b in 2022 which, if met, would be a solid 14% increase on its sales over the past 12 months. Statutory earnings per share are presumed to increase 6.7% to €1.96. Previously, the analysts had been modelling revenues of €6.4b and earnings per share (EPS) of €1.96 in 2022. So it looks like the analysts have become a bit less optimistic after the latest consensus updates announcement, with revenues expected to fall even as the company is supposed to maintain EPS.

Check out our latest analysis for Bechtle

The average price target was steady at €62.20 even though revenue estimates declined; likely suggesting the analysts place a higher value on earnings. That's not the only conclusion we can draw from this data however, as some investors also like to consider the spread in estimates when evaluating analyst price targets. Currently, the most bullish analyst values Bechtle at €76.00 per share, while the most bearish prices it at €49.00. 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.

Of course, another way to look at these forecasts is to place them into context against the industry itself. We can infer from the latest estimates that forecasts expect a continuation of Bechtle'shistorical trends, as the 14% annualised revenue growth to the end of 2022 is roughly in line with the 14% annual revenue growth over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to see their revenues grow 10% per year. So it's pretty clear that Bechtle is forecast to grow substantially faster than its industry.

The Bottom Line

The most obvious conclusion from this consensus update is that there's been no major change in the business' prospects in recent times, with analysts holding earnings per share steady, in line with previous estimates. While analysts did downgrade their revenue estimates, these forecasts still imply revenues will perform better than the wider market. Often, one downgrade can set off a daisy-chain of cuts, especially if an industry is in decline. So we wouldn't be surprised if the market became a lot more cautious on Bechtle after today.

Still, the long-term prospects of the business are much more relevant than next year's earnings. At Simply Wall St, we have a full range of analyst estimates for Bechtle 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 downgrading 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. 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.