Kreate Group Oyj Just Missed Earnings And Its Revenue Numbers Were Weaker Than Expected

It's shaping up to be a tough period for Kreate Group Oyj (HEL:KREATE), which a week ago released some disappointing second-quarter results that could have a notable impact on how the market views the stock. Results look to have been somewhat negative - revenue fell 7.5% short of analyst estimates at €68m, and statutory earnings of €0.16 per share missed forecasts by 5.9%. 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. With this in mind, we've gathered the latest statutory forecasts to see what the analysts are expecting for next year.

See our latest analysis for Kreate Group Oyj

After the latest results, the consensus from Kreate Group Oyj's dual analysts is for revenues of €280.8m in 2024, which would reflect a measurable 3.4% decline in revenue compared to the last year of performance. Per-share earnings are expected to shoot up 35% to €0.56. Yet prior to the latest earnings, the analysts had been anticipated revenues of €283.0m and earnings per share (EPS) of €0.64 in 2024. So there's definitely been a decline in sentiment after the latest results, noting the real cut to new EPS forecasts.

Despite cutting their earnings forecasts,the analysts have lifted their price target 21% to €8.60, suggesting that these impacts are not expected to weigh on the stock's value in the long term.

Of course, another way to look at these forecasts is to place them into context against the industry itself. We would highlight that revenue is expected to reverse, with a forecast 6.8% annualised decline to the end of 2024. That is a notable change from historical growth of 12% over the last three years. By contrast, our data suggests that other companies (with analyst coverage) in the same industry are forecast to see their revenue grow 5.3% annually for the foreseeable future. So although its revenues are forecast to shrink, this cloud does not come with a silver lining - Kreate Group Oyj is expected to lag the wider industry.

The Bottom Line

The biggest concern is that the analysts reduced their earnings per share estimates, suggesting business headwinds could lay ahead for Kreate Group Oyj. Fortunately, the analysts also reconfirmed their revenue estimates, suggesting that it's tracking in line with expectations. Although our data does suggest that Kreate Group Oyj's revenue is expected to perform worse than the wider 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.

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 least one analyst has provided forecasts out to 2026, which can be seen for free on our platform here.

We don't want to rain on the parade too much, but we did also find 4 warning signs for Kreate Group Oyj that you need to be mindful 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.

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