Honkarakenne Oyj (HEL:HONBS) Just Reported And Analysts Have Been Lifting Their Price Targets

Honkarakenne Oyj (HEL:HONBS) just released its latest yearly report and things are not looking great. Honkarakenne Oyj missed analyst estimates, with revenues of €37m and a statutory loss per share (eps) of €0.37 falling 2.4% and 5.7% below expectations, respectively. 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. So we gathered the latest post-earnings forecasts to see what estimate suggests is in store for next year.

View our latest analysis for Honkarakenne Oyj

Taking into account the latest results, the current consensus from Honkarakenne Oyj's solitary analyst is for revenues of €42.7m in 2025. This would reflect a solid 15% increase on its revenue over the past 12 months. Losses are predicted to fall substantially, shrinking 76% to €0.09. Before this latest report, the consensus had been expecting revenues of €42.9m and €0.03 per share in losses. So it's pretty clear the analyst has mixed opinions on Honkarakenne Oyj even after this update; although they reconfirmed their revenue numbers, it came at the cost of a regrettable increase in per-share losses.

Although the analyst are now forecasting higher losses, the average price target rose 12% to 2.5, which could indicate that these losses are expected to be "one-off", or are not anticipated to have a longer-term impact on the business.

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. One thing stands out from these estimates, which is that Honkarakenne Oyj is forecast to grow faster in the future than it has in the past, with revenues expected to display 15% annualised growth until the end of 2025. If achieved, this would be a much better result than the 3.6% annual decline over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in the industry are forecast to see their revenue grow 6.6% per year. So it looks like Honkarakenne Oyj is expected to grow faster than its competitors, at least for a while.

The Bottom Line

The most important thing to note is the forecast of increased losses next year, suggesting all may not be well at Honkarakenne Oyj. Fortunately, they also reconfirmed their revenue numbers, suggesting that it's tracking in line with expectations. Additionally, our data suggests that revenue is expected to grow faster than the wider industry. We note an upgrade to the price target, suggesting that the analyst believes the intrinsic value of the business is likely to improve over time.

With that in mind, we wouldn't be too quick to come to a conclusion on Honkarakenne Oyj. Long-term earnings power is much more important than next year's profits. We have analyst estimates for Honkarakenne Oyj going out as far as 2027, and you can see them free on our platform here.

Before you take the next step you should know about the 2 warning signs for Honkarakenne Oyj (1 makes us a bit uncomfortable!) that we have uncovered.

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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.