€8.65: That's What Analysts Think Puuilo Oyj (HEL:PUUILO) Is Worth After Its Latest Results

Investors in Puuilo Oyj (HEL:PUUILO) had a good week, as its shares rose 6.9% to close at €7.10 following the release of its annual results. It was a credible result overall, with revenues of €271m and statutory earnings per share of €0.38 both in line with analyst estimates, showing that Puuilo Oyj is executing in line with expectations. 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. We thought readers would find it interesting to see the analysts latest (statutory) post-earnings forecasts for next year.

View our latest analysis for Puuilo Oyj

Taking into account the latest results, the current consensus from Puuilo Oyj's four analysts is for revenues of €301.9m in 2023, which would reflect a notable 12% increase on its sales over the past 12 months. Statutory earnings per share are predicted to ascend 19% to €0.45. Yet prior to the latest earnings, the analysts had been anticipated revenues of €301.8m and earnings per share (EPS) of €0.46 in 2023. So it looks like there's been a small decline in overall sentiment after the recent results - there's been no major change to revenue estimates, but the analysts did make a minor downgrade to their earnings per share forecasts.

It might be a surprise to learn that the consensus price target fell 5.2% to €8.65, with the analysts clearly linking lower forecast earnings to the performance of the stock price. 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 Puuilo Oyj analyst has a price target of €9.00 per share, while the most pessimistic values it at €8.50. 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.

Looking at the bigger picture now, one of the ways we can make sense of these forecasts is to see how they measure up against both past performance and industry growth estimates. It's pretty clear that there is an expectation that Puuilo Oyj's revenue growth will slow down substantially, with revenues to the end of 2023 expected to display 12% growth on an annualised basis. This is compared to a historical growth rate of 22% over the past three years. Juxtapose this against the other companies in the industry with analyst coverage, which are forecast to grow their revenues (in aggregate) 7.0% per year. So it's pretty clear that, while Puuilo Oyj's revenue growth is expected to slow, it's still expected to grow faster than the industry itself.

The Bottom Line

The biggest concern is that the analysts reduced their earnings per share estimates, suggesting business headwinds could lay ahead for Puuilo Oyj. Happily, there were no major changes to revenue forecasts, with the business still expected to grow faster than the wider industry. The consensus price target fell measurably, with the analysts seemingly not reassured by the latest results, leading to a lower estimate of Puuilo Oyj's future valuation.

Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. We have forecasts for Puuilo Oyj going out to 2025, and you can see them free on our platform here.

However, before you get too enthused, we've discovered 4 warning signs for Puuilo Oyj (2 are a bit concerning!) that 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.