Enento Group Oyj Just Beat Analyst Forecasts, And Analysts Have Been Updating Their Predictions

It's been a good week for Enento Group Oyj (HEL:ENENTO) shareholders, because the company has just released its latest quarterly results, and the shares gained 5.1% to €17.20. Revenues were €38m, approximately in line with expectations, although statutory earnings per share (EPS) performed substantially better. EPS of €0.19 were also better than expected, beating analyst predictions by 19%. The analysts 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've gathered the most recent statutory forecasts to see whether the analysts have changed their earnings models, following these results.

Check out our latest analysis for Enento Group Oyj

Following last week's earnings report, Enento Group Oyj's four analysts are forecasting 2024 revenues to be €152.6m, approximately in line with the last 12 months. Statutory earnings per share are predicted to step up 15% to €0.74. In the lead-up to this report, the analysts had been modelling revenues of €152.2m and earnings per share (EPS) of €0.77 in 2024. The analysts seem to have become a little more negative on the business after the latest results, given the minor downgrade to their earnings per share numbers for next year.

It might be a surprise to learn that the consensus price target was broadly unchanged at €22.75, with the analysts clearly implying that the forecast decline in earnings is not expected to have much of an impact on valuation. There's another way to think about price targets though, and that's to look at the range of price targets put forward by analysts, because a wide range of estimates could suggest a diverse view on possible outcomes for the business. There are some variant perceptions on Enento Group Oyj, with the most bullish analyst valuing it at €30.00 and the most bearish at €19.00 per share. Analysts definitely have varying views on the business, but the spread of estimates is not wide enough in our view to suggest that extreme outcomes could await Enento Group Oyj shareholders.

Looking at the bigger picture now, one of the ways we can make sense of these forecasts is to see how they measure up against both past performance and industry growth estimates. It's pretty clear that there is an expectation that Enento Group Oyj's revenue growth will slow down substantially, with revenues to the end of 2024 expected to display 0.8% growth on an annualised basis. This is compared to a historical growth rate of 2.3% over the past five years. Compare this against other companies (with analyst forecasts) in the industry, which are in aggregate expected to see revenue growth of 5.8% annually. So it's pretty clear that, while revenue growth is expected to slow down, the wider industry is also expected to grow faster than Enento Group Oyj.

The Bottom Line

The biggest concern is that the analysts reduced their earnings per share estimates, suggesting business headwinds could lay ahead for Enento Group Oyj. On the plus side, there were no major changes to revenue estimates; although forecasts imply they will perform worse than the wider industry. The consensus price target held steady at €22.75, with the latest estimates not enough to have an impact on their price targets.

With that in mind, we wouldn't be too quick to come to a conclusion on Enento Group Oyj. Long-term earnings power is much more important than next year's profits. We have estimates - from multiple Enento Group Oyj analysts - going out to 2026, and you can see them free on our platform here.

You still need to take note of risks, for example - Enento Group Oyj 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.

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