Orion Oyj Just Beat EPS By 13%: Here's What Analysts Think Will Happen Next

Orion Oyj (HEL:ORNBV) defied analyst predictions to release its quarterly results, which were ahead of market expectations. Orion Oyj beat earnings, with revenues hitting €328m, ahead of expectations, and statutory earnings per share outperforming analyst reckonings by a solid 13%. The analysts typically update their forecasts at each earnings report, and we can judge from their estimates whether their view of the company has changed or if there are any new concerns to be aware of. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether the analysts have changed their mind on Orion Oyj after the latest results.

View our latest analysis for Orion Oyj

Taking into account the latest results, the consensus forecast from Orion Oyj's six analysts is for revenues of €1.42b in 2024. This reflects a solid 13% improvement in revenue compared to the last 12 months. Statutory earnings per share are predicted to soar 28% to €2.12. Before this earnings report, the analysts had been forecasting revenues of €1.41b and earnings per share (EPS) of €1.91 in 2024. There was no real change to the revenue estimates, but the analysts do seem more bullish on earnings, given the substantial gain in earnings per share expectations following these results.

There's been no major changes to the consensus price target of €39.75, suggesting that the improved earnings per share outlook is not enough to have a long-term positive impact on the stock's valuation. 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 Orion Oyj at €48.50 per share, while the most bearish prices it at €28.00. Analysts definitely have varying views on the business, but the spread of estimates is not wide enough in our view to suggest that extreme outcomes could await Orion Oyj shareholders.

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Orion Oyj's past performance and to peers in the same industry. The analysts are definitely expecting Orion Oyj's growth to accelerate, with the forecast 28% annualised growth to the end of 2024 ranking favourably alongside historical growth of 4.8% per annum over the past five years. Compare this with other companies in the same industry, which are forecast to grow their revenue 7.8% annually. It seems obvious that, while the growth outlook is brighter than the recent past, the analysts also expect Orion Oyj to grow faster than the wider industry.

The Bottom Line

The most important thing here is that the analysts upgraded their earnings per share estimates, suggesting that there has been a clear increase in optimism towards Orion Oyj following these results. 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. The consensus price target held steady at €39.75, with the latest estimates not enough to have an impact on their price targets.

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

You should always think about risks though. Case in point, we've spotted 1 warning sign for Orion Oyj you should be aware of.

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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.