Results: Kreate Group Oyj Exceeded Expectations And The Consensus Has Updated Its Estimates

Investors in Kreate Group Oyj (HEL:KREATE) had a good week, as its shares rose 7.2% to close at €8.00 following the release of its full-year results. The result was positive overall - although revenues of €320m were in line with what the analysts predicted, Kreate Group Oyj surprised by delivering a statutory profit of €0.44 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. We've gathered the most recent statutory forecasts to see whether the analysts have changed their earnings models, following these results.

View our latest analysis for Kreate Group Oyj

Following the recent earnings report, the consensus from dual analysts covering Kreate Group Oyj is for revenues of €290.0m in 2024. This implies a considerable 9.4% decline in revenue compared to the last 12 months. Per-share earnings are expected to jump 56% to €0.65. In the lead-up to this report, the analysts had been modelling revenues of €301.1m and earnings per share (EPS) of €0.64 in 2024. So it's pretty clear that while sentiment around revenues has declined following the latest results, the analysts are now more bullish on the company's earnings power.

The average price target increased 20% to €8.50, with the analysts signalling that the improved earnings outlook is more important to the company's valuation than its revenue.

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 revenue is expected to reverse, with a forecast 9.4% annualised decline to the end of 2024. That is a notable change from historical growth of 14% over the last three years. Compare this with our data, which suggests that other companies in the same industry are, in aggregate, expected to see their revenue grow 6.1% per year. 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 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 Kreate Group Oyj following these results. On the negative side, they also downgraded their revenue estimates, and forecasts imply they will perform worse than the wider industry. Even so, long term profitability is more important for the value creation process. We note an upgrade to the price target, suggesting that the analysts believes the intrinsic value of the business is likely to improve over time.

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. We have analyst estimates for Kreate Group Oyj going out as far as 2026, and you can see them free on our platform here.

It is also worth noting that we have found 3 warning signs for Kreate Group Oyj that you need to take into consideration.

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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.