Earnings Release: Here's Why Analysts Cut Their Solteq Oyj (HEL:SOLTEQ) Price Target To €0.63

Solteq Oyj (HEL:SOLTEQ) missed earnings with its latest first-quarter results, disappointing overly-optimistic forecasters. It was a pretty negative result overall, with revenues of €12m missing analyst predictions by 2.6%. Worse, the business reported a statutory loss of €0.02 per share, much larger than the analysts had forecast prior to the result. This is an important time for investors, as they can track a company's performance in its report, look at what experts are forecasting for next year, and see if there has been any change to expectations for the business. We've gathered the most recent statutory forecasts to see whether the analysts have changed their earnings models, following these results.

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Following last week's earnings report, Solteq Oyj's two analysts are forecasting 2025 revenues to be €48.6m, approximately in line with the last 12 months. Earnings are expected to improve, with Solteq Oyj forecast to report a statutory profit of €0.01 per share. Before this latest report, the consensus had been expecting revenues of €48.7m and €0.005 per share in losses. Although we saw no serious change to the revenue outlook, the analysts have definitely increased their earnings estimates, estimating a profit next year, compared to previous forecasts of a loss. So it seems like the consensus has become substantially more bullish on Solteq Oyj.

See our latest analysis for Solteq Oyj

The consensus price target fell 7.4% to €0.63, suggesting the increase in earnings forecasts was not enough to offset other the analysts concerns.

Of course, another way to look at these forecasts is to place them into context against the industry itself. One thing that stands out from these estimates is that shrinking revenues are expected to moderate over the period ending 2025 compared to the historical decline of 3.7% per annum over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to see their revenue grow 10% per year. So while a broad number of companies are forecast to grow, unfortunately Solteq Oyj is expected to see its revenue affected worse than other companies in the industry.

The Bottom Line

The most important thing to take away is that the analysts now expect Solteq Oyj to become profitable next year, compared to previous expectations that it would report a loss. Fortunately, the analysts also reconfirmed their revenue estimates, suggesting that it's tracking in line with expectations. Although our data does suggest that Solteq Oyj's revenue is expected to perform worse than the wider industry. Furthermore, the analysts 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 Solteq Oyj going out as far as 2027, and you can see them free on our platform here.

Even so, be aware that Solteq Oyj is showing 3 warning signs in our investment analysis , and 1 of those is concerning...

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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.