Vestas Wind Systems A/S Just Beat Earnings Expectations: Here's What Analysts Think Will Happen Next

Last week saw the newest full-year earnings release from Vestas Wind Systems A/S (CPH:VWS), an important milestone in the company's journey to build a stronger business. It looks like a credible result overall - although revenues of €15b were what the analysts expected, Vestas Wind Systems surprised by delivering a (statutory) profit of €0.08 per share, an impressive 107% above what was forecast. 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. With this in mind, we've gathered the latest statutory forecasts to see what the analysts are expecting for next year.

Check out our latest analysis for Vestas Wind Systems

Taking into account the latest results, the current consensus from Vestas Wind Systems' 24 analysts is for revenues of €17.1b in 2024. This would reflect a solid 11% increase on its revenue over the past 12 months. Per-share earnings are expected to jump 640% to €0.57. In the lead-up to this report, the analysts had been modelling revenues of €17.0b and earnings per share (EPS) of €0.60 in 2024. So it looks like there's been a small decline in overall sentiment after the recent results - there's been no major change to revenue estimates, but the analysts did make a minor downgrade to their earnings per share forecasts.

The consensus price target held steady at kr.214, with the analysts seemingly voting that their lower forecast earnings are not expected to lead to a lower stock price in the foreseeable future. The consensus price target is just an average of individual analyst targets, so - it could be handy to see how wide the range of underlying estimates is. The most optimistic Vestas Wind Systems analyst has a price target of kr.315 per share, while the most pessimistic values it at kr.101. As you can see the range of estimates is wide, with the lowest valuation coming in at less than half the most bullish estimate, suggesting there are some strongly diverging views on how analysts think this business will perform. With this in mind, we wouldn't rely too heavily the consensus price target, as it is just an average and analysts clearly have some deeply divergent views on the business.

Taking a look at the bigger picture now, one of the ways we can understand these forecasts is to see how they compare to both past performance and industry growth estimates. The analysts are definitely expecting Vestas Wind Systems' growth to accelerate, with the forecast 11% annualised growth to the end of 2024 ranking favourably alongside historical growth of 7.5% per annum over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to grow their revenue at 6.1% per year. Factoring in the forecast acceleration in revenue, it's pretty clear that Vestas Wind Systems is expected to grow much faster than its industry.

The Bottom Line

The most important thing to take away is that the analysts downgraded their earnings per share estimates, showing that there has been a clear decline in sentiment following these results. Happily, there were no major changes to revenue forecasts, with the business still expected to grow faster than the wider industry. The consensus price target held steady at kr.214, 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. We have estimates - from multiple Vestas Wind Systems analysts - going out to 2026, and you can see them free on our platform here.

Before you take the next step you should know about the 1 warning sign for Vestas Wind Systems that we have uncovered.

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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.