Results: Kemira Oyj Beat Earnings Expectations And Analysts Now Have New Forecasts

Kemira Oyj (HEL:KEMIRA) investors will be delighted, with the company turning in some strong numbers with its latest results. The company beat forecasts, with revenue of €763m, some 5.1% above estimates, and statutory earnings per share (EPS) coming in at €0.49, 22% ahead of expectations. 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. So we collected the latest post-earnings statutory consensus estimates to see what could be in store for next year.

View our latest analysis for Kemira Oyj

Following the recent earnings report, the consensus from seven analysts covering Kemira Oyj is for revenues of €2.89b in 2024. This implies a definite 11% decline in revenue compared to the last 12 months. Per-share earnings are expected to soar 34% to €1.58. Yet prior to the latest earnings, the analysts had been anticipated revenues of €2.86b and earnings per share (EPS) of €1.52 in 2024. The analysts seems to have become more bullish on the business, judging by their new earnings per share estimates.

The consensus price target was unchanged at €20.27, implying that the improved earnings outlook is not expected to have a long term impact on value creation for shareholders. 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. The most optimistic Kemira Oyj analyst has a price target of €23.00 per share, while the most pessimistic values it at €18.00. 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. We would highlight that revenue is expected to reverse, with a forecast 14% annualised decline to the end of 2024. That is a notable change from historical growth of 7.9% over the last five years. By contrast, our data suggests that other companies (with analyst coverage) in the same industry are forecast to see their revenue grow 4.5% annually for the foreseeable future. So although its revenues are forecast to shrink, this cloud does not come with a silver lining - Kemira Oyj is expected to lag 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. On the plus side, there were no major changes to revenue estimates; although forecasts imply they will 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.

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

You can also see whether Kemira Oyj is carrying too much debt, and whether its balance sheet is healthy, for free on our platform here.

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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.