Investors in Nixu Oyj (HEL:NIXU) had a good week, as its shares rose 7.8% to close at €8.04 following the release of its half-year results. The statutory results were not great - while revenues of €27m were in line with expectations,Nixu Oyj lost €0.06 a share in the process. Earnings are an important time for investors, as they can track a company's performance, look at what the analysts are forecasting for next year, and see if there's been a change in sentiment towards the company. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether the analysts have changed their mind on Nixu Oyj after the latest results.
Taking into account the latest results, the current consensus from Nixu Oyj's dual analysts is for revenues of €55.2m in 2021, which would reflect a credible 6.7% increase on its sales over the past 12 months. Nixu Oyj is also expected to turn profitable, with statutory earnings of €0.11 per share. Before this earnings report, the analysts had been forecasting revenues of €56.3m and earnings per share (EPS) of €0.095 in 2021. 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 €10.85, suggesting that the improved earnings per share outlook is not enough to have a long-term positive impact on the stock's valuation.
Another way we can view these estimates is in the context of the bigger picture, such as how the forecasts stack up against past performance, and whether forecasts are more or less bullish relative to other companies in the industry. It's pretty clear that there is an expectation that Nixu Oyj's revenue growth will slow down substantially, with revenues to the end of 2021 expected to display 14% growth on an annualised basis. This is compared to a historical growth rate of 20% over the past five years. By way of comparison, the other companies in this industry with analyst coverage are forecast to grow their revenue at 2.9% annually. So it's pretty clear that, while Nixu Oyj's revenue growth is expected to slow, it's still expected to grow faster than the industry itself.
The Bottom Line
The biggest takeaway for us is the consensus earnings per share upgrade, which suggests a clear improvement in sentiment around Nixu Oyj's earnings potential next year. 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 held steady at €10.85, with the latest estimates not enough to have an impact on their price targets.
With that said, the long-term trajectory of the company's earnings is a lot more important than next year. We have analyst estimates for Nixu Oyj going out as far as 2023, and you can see them free on our platform here.
We don't want to rain on the parade too much, but we did also find 1 warning sign for Nixu Oyj that you need to be mindful of.
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