Earnings Update: Here's Why Analysts Just Lifted Their Tulikivi Corporation (HEL:TULAV) Price Target To €0.55

Tulikivi Corporation (HEL:TULAV) came out with its second-quarter results last week, and we wanted to see how the business is performing and what industry forecasts think of the company following this report. Tulikivi reported in line with analyst predictions, delivering revenues of €13m and statutory earnings per share of €0.08, suggesting the business is executing well and in line with its plan. The analyst 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 analyst latest (statutory) post-earnings forecasts for next year.

View our latest analysis for Tulikivi

Taking into account the latest results, the current consensus, from the lone analyst covering Tulikivi, is for revenues of €49.7m in 2023. This implies a perceptible 2.6% reduction in Tulikivi's revenue over the past 12 months. Statutory earnings per share are forecast to decline 18% to €0.08 in the same period. Yet prior to the latest earnings, the analyst had been anticipated revenues of €49.3m and earnings per share (EPS) of €0.10 in 2023. So there's definitely been a decline in sentiment after the latest results, noting the pretty serious reduction to new EPS forecasts.

Despite cutting their earnings forecasts,the analyst has lifted their price target 10% to €0.55, 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 5.1% annualised decline to the end of 2023. That is a notable change from historical growth of 11% over the last five years. By contrast, our data suggests that other companies (with analyst coverage) in the same industry are forecast to see their revenue grow 5.1% annually for the foreseeable future. It's pretty clear that Tulikivi's revenues are expected to perform substantially worse than the wider industry.

The Bottom Line

The biggest concern is that the analyst reduced their earnings per share estimates, suggesting business headwinds could lay ahead for Tulikivi. Fortunately, the analyst also reconfirmed their revenue estimates, suggesting that it's tracking in line with expectations. Although our data does suggest that Tulikivi's revenue is expected to perform worse than the wider industry. There was also a nice increase in the price target, with the analyst 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 Tulikivi. Long-term earnings power is much more important than next year's profits. We have analyst estimates for Tulikivi going out as far as 2023, and you can see them free on our platform here.

You still need to take note of risks, for example - Tulikivi has 2 warning signs we think 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.