SSH Communications Security Oyj (HEL:SSH1V) Just Reported, And Analysts Assigned A €1.90 Price Target

As you might know, SSH Communications Security Oyj (HEL:SSH1V) last week released its latest full-year, and things did not turn out so great for shareholders. It was a pretty negative result overall, with revenues of €20m missing analyst predictions by 5.6%. Worse, the business reported a statutory loss of €0.10 per share, much larger than the analyst 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 expert is forecasting for next year, and see if there has been any change to expectations for the business. With this in mind, we've gathered the latest statutory forecasts to see what the analyst is expecting for next year.

View our latest analysis for SSH Communications Security Oyj

Following the latest results, SSH Communications Security Oyj's lone analyst are now forecasting revenues of €24.0m in 2024. This would be a meaningful 18% improvement in revenue compared to the last 12 months. Earnings are expected to improve, with SSH Communications Security Oyj forecast to report a statutory profit of €0.01 per share. Yet prior to the latest earnings, the analyst had been forecasting revenues of €26.0m and losses of €0.01 per share in 2024. While we note the minor downgrade to to the revenue outlook, the analyst is now also predicting for the business to become profitable next year - sooner than previously forecast - which looks like a pretty clear lift in expectations.

The consensus price target fell 6.9% to €1.90, with the analyst signalling that the weaker revenue outlook was a more powerful indicator than the upgraded EPS forecasts.

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the SSH Communications Security Oyj's past performance and to peers in the same industry. The analyst is definitely expecting SSH Communications Security Oyj's growth to accelerate, with the forecast 18% annualised growth to the end of 2024 ranking favourably alongside historical growth of 6.7% per annum over the past five years. Compare this with other companies in the same industry, which are forecast to grow their revenue 13% annually. Factoring in the forecast acceleration in revenue, it's pretty clear that SSH Communications Security Oyj is expected to grow much faster than its industry.

The Bottom Line

The most important thing to take away is that there's been a clear step-change in belief around the business' prospects, with the analyst now expecting SSH Communications Security Oyj to become profitable next year. They also downgraded SSH Communications Security Oyj's revenue estimates, but industry data suggests that it is expected to grow faster than the wider industry. With that said, earnings are more important to the long-term value of the business. The consensus price target fell measurably, with the analyst seemingly not reassured by the latest results, leading to a lower estimate of SSH Communications Security Oyj's future valuation.

With that in mind, we wouldn't be too quick to come to a conclusion on SSH Communications Security Oyj. Long-term earnings power is much more important than next year's profits. At least one analyst has provided forecasts out to 2026, which can be seen for free on our platform here.

You still need to take note of risks, for example - SSH Communications Security Oyj has 4 warning signs (and 2 which are potentially serious) we think you should know about.

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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.