Earnings Beat: Nokia Oyj Just Beat Analyst Forecasts, And Analysts Have Been Updating Their Models

It's been a good week for Nokia Oyj (HEL:NOKIA) shareholders, because the company has just released its latest quarterly results, and the shares gained 4.3% to €3.31. It looks to have been a decent result overall - while revenue fell marginally short of analyst estimates at €4.7b, statutory earnings beat expectations by a notable 37%, coming in at €0.08 per share. 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. With this in mind, we've gathered the latest statutory forecasts to see what the analysts are expecting for next year.

See our latest analysis for Nokia Oyj

After the latest results, the 22 analysts covering Nokia Oyj are now predicting revenues of €21.7b in 2024. If met, this would reflect a satisfactory 2.9% improvement in revenue compared to the last 12 months. Statutory earnings per share are predicted to leap 84% to €0.27. Before this earnings report, the analysts had been forecasting revenues of €22.0b and earnings per share (EPS) of €0.25 in 2024. The analysts seems to have become more bullish on the business, judging by their new earnings per share estimates.

There's been no major changes to the consensus price target of €3.93, suggesting that the improved earnings per share outlook is not enough to have a long-term positive impact on the stock's valuation. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. There are some variant perceptions on Nokia Oyj, with the most bullish analyst valuing it at €6.50 and the most bearish at €2.90 per share. This is a fairly broad spread of estimates, suggesting that analysts are forecasting a wide range of possible outcomes for the business.

Of course, another way to look at these forecasts is to place them into context against the industry itself. It's clear from the latest estimates that Nokia Oyj's rate of growth is expected to accelerate meaningfully, with the forecast 3.9% annualised revenue growth to the end of 2024 noticeably faster than its historical growth of 0.7% p.a. over the past five years. Compare this with other companies in the same industry, which are forecast to grow their revenue 2.9% annually. Factoring in the forecast acceleration in revenue, it's pretty clear that Nokia 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 Nokia Oyj following these results. Fortunately, they also reconfirmed their revenue numbers, suggesting that it's tracking in line with expectations. Additionally, our data suggests that revenue is 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.

With that in mind, we wouldn't be too quick to come to a conclusion on Nokia Oyj. Long-term earnings power is much more important than next year's profits. We have forecasts for Nokia Oyj going out to 2026, 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 3 warning signs for Nokia Oyj that you need to be mindful of.

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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.