Witted Megacorp Oyj (HEL:WITTED) Just Reported Earnings, And Analysts Cut Their Target Price

It's been a good week for Witted Megacorp Oyj (HEL:WITTED) shareholders, because the company has just released its latest second-quarter results, and the shares gained 9.6% to €1.72. It was an okay report, and revenues came in at €14m, approximately in line with analyst estimates leading up to the results announcement. Following the result, the analyst has updated their earnings model, and it would be good to know whether they think there's been a strong change in the company's prospects, or if it's business as usual. So we gathered the latest post-earnings forecasts to see what estimate suggests is in store for next year.

View our latest analysis for Witted Megacorp Oyj

Taking into account the latest results, the sole analyst covering Witted Megacorp Oyj provided consensus estimates of €53.7m revenue in 2024, which would reflect a perceptible 7.7% decline over the past 12 months. Yet prior to the latest earnings, the analyst had been anticipated revenues of €54.7m and break-even in 2024. Overall, while the analyst has reconfirmed their revenue estimates, the consensus now no longer provides an EPS estimate. This implies that the market believes revenue is more important after these latest results.

Intriguingly,the analyst has cut their price target 8.3% to €2.20 showing a clear decline in sentiment around Witted Megacorp Oyj's valuation.

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. Over the past year, revenues have declined around 6.2% annually. Worse, forecasts are essentially predicting the decline to accelerate, with the estimate for an annualised 15% decline in revenue until the end of 2024. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to see their revenue grow 3.7% per year. So while a broad number of companies are forecast to grow, unfortunately Witted Megacorp 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 analyst reconfirmed their revenue estimates for next year, suggesting that the business is performing in line with expectations. On the plus side, there were no major changes to revenue estimates; although forecasts imply they will perform worse than the wider industry. 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.

We have estimates for Witted Megacorp Oyj from one covering analyst, and you can see them free on our platform here.

Before you take the next step you should know about the 3 warning signs for Witted Megacorp Oyj (1 is potentially serious!) that we have uncovered.

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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.