Solwers Oyj Just Recorded A 33% EPS Beat: Here's What Analysts Are Forecasting Next

A week ago, Solwers Oyj (HEL:SOLWERS) came out with a strong set of annual numbers that could potentially lead to a re-rate of the stock. The company beat forecasts, with revenue of €67m, some 4.9% above estimates, and statutory earnings per share (EPS) coming in at €0.32, 33% ahead of expectations. Following the result, the analyst has 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. With this in mind, we've gathered the latest statutory forecasts to see what the analyst is expecting for next year.

View our latest analysis for Solwers Oyj

Taking into account the latest results, the most recent consensus for Solwers Oyj from solitary analyst is for revenues of €77.1m in 2024. If met, it would imply a meaningful 15% increase on its revenue over the past 12 months. Statutory earnings per share are expected to shrink 8.0% to €0.29 in the same period. In the lead-up to this report, the analyst had been modelling revenues of €75.0m and earnings per share (EPS) of €0.27 in 2024. So there seems to have been a moderate uplift in sentiment following the latest results, given the upgrades to both revenue and earnings per share forecasts for next year.

As a result, it might be a surprise to see thatthe analyst has cut their price target 9.1% to €5.00, which could suggest the forecast improvement in performance is not expected to last.

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. It's pretty clear that there is an expectation that Solwers Oyj's revenue growth will slow down substantially, with revenues to the end of 2024 expected to display 15% growth on an annualised basis. This is compared to a historical growth rate of 19% over the past five years. Juxtapose this against the other companies in the industry with analyst coverage, which are forecast to grow their revenues (in aggregate) 5.2% per year. So it's pretty clear that, while Solwers Oyj's revenue growth is expected to slow, it's still expected to grow faster than the industry itself.

The Bottom Line

The most important thing here is that the analyst upgraded their earnings per share estimates, suggesting that there has been a clear increase in optimism towards Solwers Oyj following these results. Happily, they also upgraded their revenue estimates, and are forecasting them to grow faster than the wider industry. The consensus price target fell measurably, with the analyst seemingly not reassured by the latest results, leading to a lower estimate of Solwers Oyj's future valuation.

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.

It is also worth noting that we have found 2 warning signs for Solwers 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.