The Gestamp Automoción, S.A. (BME:GEST) Half-Year Results Are Out And Analysts Have Published New Forecasts

Gestamp Automoción, S.A. (BME:GEST) shareholders are probably feeling a little disappointed, since its shares fell 2.1% to €2.60 in the week after its latest half-year results. It was an okay report, and revenues came in at €6.1b, approximately in line with analyst estimates leading up to the results announcement. Following the result, the analysts have updated their earnings model, and it would be good to know whether they think there's been a strong change in the company's prospects, or if it's business as usual. So we gathered the latest post-earnings forecasts to see what estimates suggest is in store for next year.

See our latest analysis for Gestamp Automoción

Following last week's earnings report, Gestamp Automoción's ten analysts are forecasting 2024 revenues to be €12.4b, approximately in line with the last 12 months. Per-share earnings are expected to jump 28% to €0.50. Yet prior to the latest earnings, the analysts had been anticipated revenues of €12.4b and earnings per share (EPS) of €0.53 in 2024. The analysts seem to have become a little more negative on the business after the latest results, given the small dip in their earnings per share numbers for next year.

The consensus price target held steady at €4.11, 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. Currently, the most bullish analyst values Gestamp Automoción at €6.00 per share, while the most bearish prices it at €2.80. This is a fairly broad spread of estimates, suggesting that analysts are forecasting a wide range of possible outcomes for 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. We would highlight that Gestamp Automoción's revenue growth is expected to slow, with the forecast 2.4% annualised growth rate until the end of 2024 being well below the historical 9.5% p.a. growth over the last five years. By way of comparison, the other companies in this industry with analyst coverage are forecast to grow their revenue at 4.2% 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 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. Fortunately, the analysts also reconfirmed their revenue estimates, suggesting that it's tracking in line with expectations. Although our data does suggest that Gestamp Automoción's revenue is expected to perform worse than the wider industry. The consensus price target held steady at €4.11, 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 Gestamp Automoción analysts - going out to 2026, and you can see them free on our platform here.

You should always think about risks though. Case in point, we've spotted 3 warning signs for Gestamp Automoción you should be aware of, and 1 of them shouldn't be ignored.

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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.

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