KONE Oyj (HEL:KNEBV) shareholders are probably feeling a little disappointed, since its shares fell 5.2% to €71.52 in the week after its latest quarterly results. The result was positive overall - although revenues of €2.6b were in line with what the analysts predicted, KONE Oyj surprised by delivering a statutory profit of €0.50 per share, modestly greater than expected. 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. So we gathered the latest post-earnings forecasts to see what estimates suggest is in store for next year.
Taking into account the latest results, the most recent consensus for KONE Oyj from 23 analysts is for revenues of €10.5b in 2021 which, if met, would be a satisfactory 4.5% increase on its sales over the past 12 months. Statutory earnings per share are predicted to climb 13% to €2.05. Yet prior to the latest earnings, the analysts had been anticipated revenues of €10.5b and earnings per share (EPS) of €2.06 in 2021. The consensus analysts don't seem to have seen anything in these results that would have changed their view on the business, given there's been no major change to their estimates.
It will come as no surprise then, to learn that the consensus price target is largely unchanged at €63.00. The consensus price target is just an average of individual analyst targets, so - it could be handy to see how wide the range of underlying estimates is. Currently, the most bullish analyst values KONE Oyj at €84.00 per share, while the most bearish prices it at €45.20. Note the wide gap in analyst price targets? This implies to us that there is a fairly broad range of possible scenarios for the underlying 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. The analysts are definitely expecting KONE Oyj's growth to accelerate, with the forecast 4.5% growth ranking favourably alongside historical growth of 3.3% per annum over the past five years. Compare this with other companies in the same industry, which are forecast to grow their revenue 4.3% next year. Factoring in the forecast acceleration in revenue, it's pretty clear that KONE Oyj is expected to grow at about the same rate as the wider industry.
The Bottom Line
The most important thing to take away is that there's been no major change in sentiment, with the analysts reconfirming that the business is performing in line with their previous earnings per share estimates. Happily, there were no real changes to sales forecasts, with the business still expected to grow in line with the overall industry. The consensus price target held steady at €63.00, with the latest estimates not enough to have an impact on their price targets.
Following on from that line of thought, we think that the long-term prospects of the business are much more relevant than next year's earnings. At Simply Wall St, we have a full range of analyst estimates for KONE Oyj going out to 2024, 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 1 warning sign for KONE Oyj that you need to be mindful of.
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This article by Simply Wall St is general in nature. 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.
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