Gestamp Automoción, S.A. Earnings Missed Analyst Estimates: Here's What Analysts Are Forecasting Now

Last week, you might have seen that Gestamp Automoción, S.A. (BME:GEST) released its annual result to the market. The early response was not positive, with shares down 4.2% to €2.96 in the past week. It was not a great result overall. Although revenues beat expectations, hitting €12b, statutory earnings missed analyst forecasts by 11%, coming in at just €0.49 per share. 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.

View our latest analysis for Gestamp Automoción

Taking into account the latest results, Gestamp Automoción's eleven analysts currently expect revenues in 2024 to be €12.5b, approximately in line with the last 12 months. Statutory earnings per share are expected to decrease 6.8% to €0.46 in the same period. In the lead-up to this report, the analysts had been modelling revenues of €12.5b and earnings per share (EPS) of €0.61 in 2024. The analysts seem to have become more bearish following the latest results. While there were no changes to revenue forecasts, there was a large cut to EPS estimates.

The consensus price target held steady at €4.50, with the analysts seemingly voting that their lower forecast earnings are not expected to lead to a lower stock price in the foreseeable future. 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. There are some variant perceptions on Gestamp Automoción, with the most bullish analyst valuing it at €6.00 and the most bearish at €3.20 per share. This is a fairly broad spread of estimates, suggesting that analysts are forecasting a wide range of possible outcomes for the business.

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Gestamp Automoción's past performance and to peers in the same industry. It's pretty clear that there is an expectation that Gestamp Automoción's revenue growth will slow down substantially, with revenues to the end of 2024 expected to display 0.1% growth on an annualised basis. This is compared to a historical growth rate of 7.6% over the past five years. By way of comparison, the other companies in this industry with analyst coverage are forecast to grow their revenue at 3.7% per year. Factoring in the forecast slowdown in growth, it seems obvious that Gestamp Automoción is also expected to grow slower than other industry participants.

The Bottom Line

The biggest concern is that the analysts reduced their earnings per share estimates, suggesting business headwinds could lay ahead for Gestamp Automoción. On the plus side, there were no major changes to revenue estimates; although forecasts imply they will perform worse than the wider industry. There was no real change to the consensus price target, suggesting that the intrinsic value of the business has not undergone any major changes with the latest estimates.

With that in mind, we wouldn't be too quick to come to a conclusion on Gestamp Automoción. Long-term earnings power is much more important than next year's profits. We have estimates - from multiple Gestamp Automoción analysts - going out to 2026, and you can see them free on our platform here.

We don't want to rain on the parade too much, but we did also find 2 warning signs for Gestamp Automoción (1 is potentially serious!) that you need to be mindful of.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

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.