Wärtsilä Oyj Abp Just Missed Earnings And Its Revenue Numbers Were Weaker Than Expected

It's been a good week for Wärtsilä Oyj Abp (HEL:WRT1V) shareholders, because the company has just released its latest quarterly results, and the shares gained 2.5% to €15.61. Results look mixed - while revenue fell marginally short of analyst estimates at €1.6b, statutory earnings were in line with expectations, at €0.21 per share. Following the result, the analysts have updated their earnings model, and it would be good to know whether they think there's been a strong change in the company's prospects, or if it's business as usual. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether the analysts have changed their mind on Wärtsilä Oyj Abp after the latest results.

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Taking into account the latest results, the current consensus from Wärtsilä Oyj Abp's 16 analysts is for revenues of €7.14b in 2025. This would reflect an okay 6.8% increase on its revenue over the past 12 months. Per-share earnings are expected to rise 6.4% to €0.98. Before this earnings report, the analysts had been forecasting revenues of €7.36b and earnings per share (EPS) of €0.95 in 2025. If anything, the analysts look to have become slightly more optimistic overall; while they decreased their revenue forecasts, EPS predictions increased and ultimately earnings are more important.

View our latest analysis for Wärtsilä Oyj Abp

There's been no real change to the average price target of €17.01, with the lower revenue and higher earnings forecasts not expected to meaningfully impact the company's valuation over a longer timeframe. 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 Wärtsilä Oyj Abp at €22.00 per share, while the most bearish prices it at €11.00. 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.

Of course, another way to look at these forecasts is to place them into context against the industry itself. The analysts are definitely expecting Wärtsilä Oyj Abp's growth to accelerate, with the forecast 9.1% annualised growth to the end of 2025 ranking favourably alongside historical growth of 7.1% per annum over the past five years. Compare this with other companies in the same industry, which are forecast to grow their revenue 4.6% annually. It seems obvious that, while the growth outlook is brighter than the recent past, the analysts also expect Wärtsilä Oyj Abp to grow faster than 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 Wärtsilä Oyj Abp following these results. Regrettably, they also downgraded their revenue estimates, but the latest forecasts still imply the business will grow faster than the wider industry. Yet - earnings are more important to the intrinsic value of the business. The consensus price target held steady at €17.01, 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 Wärtsilä Oyj Abp going out to 2027, and you can see them free on our platform here..

You should always think about risks though. Case in point, we've spotted 1 warning sign for Wärtsilä Oyj Abp 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.