Vestas Wind Systems A/S Just Missed EPS By 42%: Here's What Analysts Think Will Happen Next

It's been a sad week for Vestas Wind Systems A/S (CPH:VWS), who've watched their investment drop 20% to kr.104 in the week since the company reported its quarterly result. Revenue of €5.2b surpassed estimates by 5.7%, although statutory earnings per share missed badly, coming in 42% below expectations at €0.13 per share. Earnings are an important time for investors, as they can track a company's performance, look at what the analysts are forecasting for next year, and see if there's been a change in sentiment towards the company. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether the analysts have changed their mind on Vestas Wind Systems after the latest results.

View our latest analysis for Vestas Wind Systems

Taking into account the latest results, the consensus forecast from Vestas Wind Systems' 25 analysts is for revenues of €19.8b in 2025. This reflects a sizeable 24% improvement in revenue compared to the last 12 months. Per-share earnings are expected to bounce 2,076% to €1.06. Yet prior to the latest earnings, the analysts had been anticipated revenues of €19.8b and earnings per share (EPS) of €1.10 in 2025. The analysts seem to have become a little more negative on the business after the latest results, given the minor downgrade to their earnings per share numbers for next year.

The consensus price target held steady at kr.192, with the analysts seemingly voting that their lower forecast earnings are not expected to lead to a lower stock price in the foreseeable future. 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. There are some variant perceptions on Vestas Wind Systems, with the most bullish analyst valuing it at kr.280 and the most bearish at kr.98.97 per share. With such a wide range in price targets, analysts are almost certainly betting on widely divergent outcomes in the underlying business. 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.

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 Vestas Wind Systems' rate of growth is expected to accelerate meaningfully, with the forecast 19% annualised revenue growth to the end of 2025 noticeably faster than its historical growth of 3.8% p.a. 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 7.0% 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.192, 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 forecasts for Vestas Wind Systems going out to 2026, and you can see them free on our platform here.

Even so, be aware that Vestas Wind Systems is showing 2 warning signs in our investment analysis , you should know about...

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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.