The Suominen Oyj (HEL:SUY1V) Second-Quarter Results Are Out And Analysts Have Published New Forecasts

Suominen Oyj (HEL:SUY1V) last week reported its latest quarterly results, which makes it a good time for investors to dive in and see if the business is performing in line with expectations. Overall the results were a little better than the analysts were expecting, with revenues beating forecasts by 2.3%to hit €119m. 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. We thought readers would find it interesting to see the analysts latest (statutory) post-earnings forecasts for next year.

See our latest analysis for Suominen Oyj

After the latest results, the three analysts covering Suominen Oyj are now predicting revenues of €468.5m in 2024. If met, this would reflect a reasonable 3.3% improvement in revenue compared to the last 12 months. Per-share statutory losses are expected to explode, reaching €0.0034 per share. Before this earnings report, the analysts had been forecasting revenues of €465.4m and earnings per share (EPS) of €0.038 in 2024. So despite reconfirming their revenue estimates, the analysts are now forecasting a loss instead of a profit, which looks like a definite drop in sentiment following the latest results.

As a result, there was no major change to the consensus price target of €2.48, with the analysts implicitly confirming that the business looks to be performing in line with expectations, despite higher forecast losses. Fixating on a single price target can be unwise though, since the consensus target is effectively the average of analyst price targets. As a result, some investors like to look at the range of estimates to see if there are any diverging opinions on the company's valuation. Currently, the most bullish analyst values Suominen Oyj at €2.50 per share, while the most bearish prices it at €2.45. Still, with such a tight range of estimates, it suggeststhe analysts have a pretty good idea of what they think the company is worth.

Another way we can view these estimates is in the context of the bigger picture, such as how the forecasts stack up against past performance, and whether forecasts are more or less bullish relative to other companies in the industry. The analysts are definitely expecting Suominen Oyj's growth to accelerate, with the forecast 6.6% annualised growth to the end of 2024 ranking favourably alongside historical growth of 2.3% per annum over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to grow their revenue at 3.1% per year. It seems obvious that, while the growth outlook is brighter than the recent past, the analysts also expect Suominen Oyj to grow faster than the wider industry.

The Bottom Line

The most important thing to take away is that the analysts are expecting Suominen Oyj to become unprofitable next year. Happily, there were no major changes to revenue forecasts, with the business still expected to grow faster than the wider industry. There was no real change to the consensus price target, suggesting that the intrinsic value of the business has not undergone any major changes with the latest estimates.

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. We have forecasts for Suominen Oyj going out to 2026, and you can see them free on our platform here.

It is also worth noting that we have found 1 warning sign for Suominen 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.