Analysts Just Published A Bright New Outlook For Grenergy Renovables, S.A.'s (BME:GRE)

Grenergy Renovables, S.A. (BME:GRE) shareholders will have a reason to smile today, with the analysts making substantial upgrades to this year's statutory forecasts. Consensus estimates suggest investors could expect greatly increased statutory revenues and earnings per share, with the analysts modelling a real improvement in business performance.

Following the upgrade, the consensus from seven analysts covering Grenergy Renovables is for revenues of €262m in 2023, implying a concerning 23% decline in sales compared to the last 12 months. Statutory earnings per share are presumed to bounce 184% to €1.04. Previously, the analysts had been modelling revenues of €233m and earnings per share (EPS) of €0.93 in 2023. So we can see there's been a pretty clear increase in analyst sentiment in recent times, with both revenues and earnings per share receiving a decent lift in the latest estimates.

See our latest analysis for Grenergy Renovables

Despite these upgrades, the analysts have not made any major changes to their price target of €39.79, suggesting that the higher estimates are not likely to have a long term impact on what the stock is worth. 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. Currently, the most bullish analyst values Grenergy Renovables at €45.00 per share, while the most bearish prices it at €34.00. Still, with such a tight range of estimates, it suggests the analysts have a pretty good idea of what they think the company is worth.

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Grenergy Renovables' past performance and to peers in the same industry. These estimates imply that sales are expected to slow, with a forecast annualised revenue decline of 30% by the end of 2023. This indicates a significant reduction from annual growth of 43% over the last five years. Yet aggregate analyst estimates for other companies in the industry suggest that industry revenues are forecast to decline 1.8% per year. The forecasts do look bearish for Grenergy Renovables, since they're expecting it to shrink faster than the industry.

The Bottom Line

The biggest takeaway for us from these new estimates is that analysts upgraded their earnings per share estimates, with improved earnings power expected for this year. They also upgraded their revenue estimates, with sales apparently performing well even though revenue growth expected to decline against the wider market this year. The lack of change in the price target is puzzling, but with a serious upgrade to this year's earnings expectations, it might be time to take another look at Grenergy Renovables.

Analysts are definitely bullish on Grenergy Renovables, but no company is perfect. Indeed, you should know that there are several potential concerns to be aware of, including its declining profit margins. You can learn more, and discover the 3 other flags we've identified, for free on our platform here.

Of course, seeing company management invest large sums of money in a stock can be just as useful as knowing whether analysts are upgrading their estimates. So you may also wish to search this free list of stocks that insiders are buying.

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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.