Cancom SE Just Beat Earnings Expectations: Here's What Analysts Think Will Happen Next

Cancom SE (ETR:COK) shareholders are probably feeling a little disappointed, since its shares fell 6.5% to €48.62 in the week after its latest full-year results. Revenues were €1.7b, approximately in line with whatthe analysts expected, although statutory earnings per share (EPS) crushed expectations, coming in at €1.60, an impressive 26% ahead of estimates. This is an important time for investors, as they can track a company's performance in its report, look at what experts are forecasting for next year, and see if there has been any change to expectations for the business. We've gathered the most recent statutory forecasts to see whether the analysts have changed their earnings models, following these results.

Check out our latest analysis for Cancom

After the latest results, the seven analysts covering Cancom are now predicting revenues of €1.82b in 2021. If met, this would reflect a meaningful 9.0% improvement in sales compared to the last 12 months. Statutory earnings per share are expected to dip 7.7% to €1.48 in the same period. Yet prior to the latest earnings, the analysts had been anticipated revenues of €1.84b and earnings per share (EPS) of €1.50 in 2021. The consensus analysts don't seem to have seen anything in these results that would have changed their view on the business, given there's been no major change to their estimates.

The analysts reconfirmed their price target of €61.50, showing that the business is executing well and in line with expectations. 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 Cancom analyst has a price target of €70.00 per share, while the most pessimistic values it at €52.00. Even so, with a relatively close grouping of estimates, it looks like the analysts are quite confident in their valuations, suggesting Cancom is an easy business to forecast or the the analysts are all using similar assumptions.

One way to get more context on these forecasts is to look at how they compare to both past performance, and how other companies in the same industry are performing. We would highlight that Cancom's revenue growth is expected to slow, with the forecast 9.0% annualised growth rate until the end of 2021 being well below the historical 13% p.a. growth over the last five years. Juxtapose this against the other companies in the industry with analyst coverage, which are forecast to grow their revenues (in aggregate) 7.9% annually. So it's pretty clear that, while Cancom's revenue growth is expected to slow, it's expected to grow roughly in line with the industry.

The Bottom Line

The most obvious conclusion is that there's been no major change in the business' prospects in recent times, with the analysts holding their earnings forecasts steady, in line with previous estimates. Happily, there were no real changes to sales forecasts, with the business still expected to grow in line with the overall industry. The consensus price target held steady at €61.50, 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 Cancom going out to 2025, and you can see them free on our platform here..

Another thing to consider is whether management and directors have been buying or selling stock recently. We provide an overview of all open market stock trades for the last twelve months on our platform, here.

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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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