Kemira Oyj Just Missed Earnings - But Analysts Have Updated Their Models

Kemira Oyj (HEL:KEMIRA) shareholders are probably feeling a little disappointed, since its shares fell 8.6% to €20.64 in the week after its latest second-quarter results. It was not a great result overall. While revenues of €733m were in line with analyst predictions, earnings were less than expected, missing statutory estimates by 11% to hit €0.40 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. With this in mind, we've gathered the latest statutory forecasts to see what the analysts are expecting for next year.

View our latest analysis for Kemira Oyj

After the latest results, the consensus from Kemira Oyj's eight analysts is for revenues of €2.92b in 2024, which would reflect a noticeable 7.0% decline in revenue compared to the last year of performance. Per-share earnings are expected to jump 50% to €1.75. Yet prior to the latest earnings, the analysts had been anticipated revenues of €2.96b and earnings per share (EPS) of €1.70 in 2024. So the consensus seems to have become somewhat more optimistic on Kemira Oyj's earnings potential following these results.

There's been no major changes to the consensus price target of €24.70, suggesting that the improved earnings per share outlook is not enough to have a long-term positive impact on the stock's valuation. The consensus price target is just an average of individual analyst targets, so - it could be handy to see how wide the range of underlying estimates is. There are some variant perceptions on Kemira Oyj, with the most bullish analyst valuing it at €27.00 and the most bearish at €22.00 per share. The narrow spread of estimates could suggest that the business' future is relatively easy to value, or thatthe analysts have a strong view on its prospects.

One way to get more context on these forecasts is to look at how they compare to both past performance, and how other companies in the same industry are performing. These estimates imply that revenue is expected to slow, with a forecast annualised decline of 14% by the end of 2024. This indicates a significant reduction from annual growth of 7.7% over the last five years. Compare this with our data, which suggests that other companies in the same industry are, in aggregate, expected to see their revenue grow 4.4% per year. It's pretty clear that Kemira Oyj's revenues are expected to perform substantially worse than the wider industry.

The Bottom Line

The biggest takeaway for us is the consensus earnings per share upgrade, which suggests a clear improvement in sentiment around Kemira Oyj's earnings potential next year. Fortunately, the analysts also reconfirmed their revenue estimates, suggesting that it's tracking in line with expectations. Although our data does suggest that Kemira Oyj's revenue is expected to perform worse 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.

Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. At Simply Wall St, we have a full range of analyst estimates for Kemira Oyj going out to 2026, and you can see them free on our platform here..

And what about risks? Every company has them, and we've spotted 3 warning signs for Kemira Oyj you should know about.

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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