Analysts Are Updating Their Detection Technology Oyj (HEL:DETEC) Estimates After Its Second-Quarter Results

Detection Technology Oyj (HEL:DETEC) just released its latest quarterly results and things are looking bullish. Results were good overall, with revenues beating analyst predictions by 3.0% to hit €26m. Statutory earnings per share (EPS) came in at €0.15, some 4.7% above whatthe analysts had expected. 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. So we gathered the latest post-earnings forecasts to see what estimates suggest is in store for next year.

View our latest analysis for Detection Technology Oyj

Taking into account the latest results, the consensus forecast from Detection Technology Oyj's five analysts is for revenues of €112.2m in 2024. This reflects a credible 7.2% improvement in revenue compared to the last 12 months. Statutory earnings per share are predicted to shoot up 46% to €0.80. In the lead-up to this report, the analysts had been modelling revenues of €110.9m and earnings per share (EPS) of €0.73 in 2024. There was no real change to the revenue estimates, but the analysts do seem more bullish on earnings, given the solid gain to earnings per share expectations following these results.

There's been no major changes to the consensus price target of €20.00, suggesting that the improved earnings per share outlook is not enough to have a long-term positive impact on the stock's valuation. There's another way to think about price targets though, and that's to look at the range of price targets put forward by analysts, because a wide range of estimates could suggest a diverse view on possible outcomes for the business. The most optimistic Detection Technology Oyj analyst has a price target of €25.00 per share, while the most pessimistic values it at €16.50. Analysts definitely have varying views on the business, but the spread of estimates is not wide enough in our view to suggest that extreme outcomes could await Detection Technology Oyj shareholders.

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. It's clear from the latest estimates that Detection Technology Oyj's rate of growth is expected to accelerate meaningfully, with the forecast 15% annualised revenue growth to the end of 2024 noticeably faster than its historical growth of 2.0% p.a. over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to grow their revenue at 6.7% per year. Factoring in the forecast acceleration in revenue, it's pretty clear that Detection Technology Oyj is expected to grow much faster than its industry.

The Bottom Line

The most important thing here is that the analysts upgraded their earnings per share estimates, suggesting that there has been a clear increase in optimism towards Detection Technology Oyj following these results. Happily, there were no major changes to revenue forecasts, with the business still expected to grow faster than the wider industry. There was no real change to the consensus price target, suggesting that the intrinsic value of the business has not undergone any major changes with the latest estimates.

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 forecasts for Detection Technology Oyj going out to 2026, and you can see them free on our platform here.

Plus, you should also learn about the 1 warning sign we've spotted with Detection Technology Oyj .

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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.