Bittium Oyj Just Beat EPS By 55%: Here's What Analysts Think Will Happen Next

Bittium Oyj (HEL:BITTI) defied analyst predictions to release its annual results, which were ahead of market expectations. It was overall a positive result, with revenues beating expectations by 8.0% to hit €87m. Bittium Oyj also reported a statutory profit of €0.093, which was an impressive 55% above what the analyst had forecast. The analyst 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 analyst latest (statutory) post-earnings forecasts for next year.

View our latest analysis for Bittium Oyj

Taking into account the latest results, the current consensus from Bittium Oyj's sole analyst is for revenues of €91.0m in 2022, which would reflect a reasonable 4.1% increase on its sales over the past 12 months. Statutory earnings per share are predicted to surge 51% to €0.14. Yet prior to the latest earnings, the analyst had been anticipated revenues of €95.7m and earnings per share (EPS) of €0.22 in 2022. From this we can that sentiment has definitely become more bearish after the latest results, leading to lower revenue forecasts and a large cut to earnings per share estimates.

The consensus price target fell 8.3% to €5.50, with the weaker earnings outlook clearly leading valuation estimates.

Of course, another way to look at these forecasts is to place them into context against the industry itself. It's pretty clear that there is an expectation that Bittium Oyj's revenue growth will slow down substantially, with revenues to the end of 2022 expected to display 4.1% growth on an annualised basis. This is compared to a historical growth rate of 8.7% over the past five years. Compare this against other companies (with analyst forecasts) in the industry, which are in aggregate expected to see revenue growth of 17% annually. Factoring in the forecast slowdown in growth, it seems obvious that Bittium Oyj is also expected to grow slower than other industry participants.

The Bottom Line

The most important thing to take away is that the analyst downgraded their earnings per share estimates, showing that there has been a clear decline in sentiment following these results. Unfortunately, they also downgraded their revenue estimates, and our data indicates revenues are expected to perform worse than the wider industry. Even so, earnings per share are more important to the intrinsic value of the business. Furthermore, the analyst also cut their price targets, suggesting that the latest news has led to greater pessimism about the intrinsic value of the business.

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 analyst estimates for Bittium Oyj going out as far as 2024, and you can see them free on our platform here.

We also provide an overview of the Bittium Oyj Board and CEO remuneration and length of tenure at the company, and whether insiders have been buying the stock, 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.