Earnings Update: Here's Why Analysts Just Lifted Their Prosegur Cash, S.A. (BME:CASH) Price Target To €0.84

It's been a good week for Prosegur Cash, S.A. (BME:CASH) shareholders, because the company has just released its latest first-quarter results, and the shares gained 4.0% to €0.80. It was a credible result overall, with revenues of €516m and statutory earnings per share of €0.06 both in line with analyst estimates, showing that Prosegur Cash is executing in line with expectations. The analysts typically update their forecasts at each earnings report, and we can judge from their estimates whether their view of the company has changed or if there are any new concerns to be aware of. We thought readers would find it interesting to see the analysts latest (statutory) post-earnings forecasts for next year.

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Following the latest results, Prosegur Cash's five analysts are now forecasting revenues of €2.20b in 2025. This would be a credible 2.9% improvement in revenue compared to the last 12 months. Per-share earnings are expected to surge 30% to €0.083. Yet prior to the latest earnings, the analysts had been anticipated revenues of €2.18b and earnings per share (EPS) of €0.08 in 2025. The analysts seems to have become more bullish on the business, judging by their new earnings per share estimates.

Check out our latest analysis for Prosegur Cash

The consensus price target rose 13% to €0.84, suggesting that higher earnings estimates flow through to the stock's valuation as well. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. There are some variant perceptions on Prosegur Cash, with the most bullish analyst valuing it at €1.00 and the most bearish at €0.65 per share. There are definitely some different views on the stock, but the range of estimates is not wide enough as to imply that the situation is unforecastable, in our view.

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. It's pretty clear that there is an expectation that Prosegur Cash's revenue growth will slow down substantially, with revenues to the end of 2025 expected to display 3.8% growth on an annualised basis. This is compared to a historical growth rate of 6.2% over the past five years. Compare this to the 145 other companies in this industry with analyst coverage, which are forecast to grow their revenue at 4.3% per year. Factoring in the forecast slowdown in growth, it looks like Prosegur Cash is forecast to grow at about the same rate as the wider industry.

The Bottom Line

The most important thing here is that the analysts upgraded their earnings per share estimates, suggesting that there has been a clear increase in optimism towards Prosegur Cash following these results. Happily, there were no real changes to revenue forecasts, with the business still expected to grow in line with the overall industry. There was also a nice increase in the price target, with the analysts clearly feeling that the intrinsic value of the business is improving.

With that in mind, we wouldn't be too quick to come to a conclusion on Prosegur Cash. Long-term earnings power is much more important than next year's profits. At Simply Wall St, we have a full range of analyst estimates for Prosegur Cash going out to 2027, and you can see them free on our platform here..

However, before you get too enthused, we've discovered 2 warning signs for Prosegur Cash (1 is potentially serious!) that you should be aware of.

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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.