Revenue Miss: Fortum Oyj Fell 7.4% Short Of Analyst Revenue Estimates And Analysts Have Been Revising Their Models

Explore Fortum Oyj's Fair Values from the Community and select yours

Shareholders might have noticed that Fortum Oyj (HEL:FORTUM) filed its quarterly result this time last week. The early response was not positive, with shares down 4.8% to €15.01 in the past week. Revenues came in 7.4% below expectations, at €974m. Statutory earnings per share were relatively better off, with a per-share profit of €0.12 being roughly in line with analyst estimates. 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. So we collected the latest post-earnings statutory consensus estimates to see what could be in store for next year.

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After the latest results, the consensus from Fortum Oyj's 14 analysts is for revenues of €5.03b in 2025, which would reflect a discernible 2.2% decline in revenue compared to the last year of performance. Statutory earnings per share are forecast to descend 17% to €0.87 in the same period. Before this earnings report, the analysts had been forecasting revenues of €5.23b and earnings per share (EPS) of €0.93 in 2025. It's pretty clear that pessimism has reared its head after the latest results, leading to a weaker revenue outlook and a minor downgrade to earnings per share estimates.

Check out our latest analysis for Fortum Oyj

The analysts made no major changes to their price target of €13.76, suggesting the downgrades are not expected to have a long-term impact on Fortum Oyj's valuation. The consensus price target is just an average of individual analyst targets, so - it could be handy to see how wide the range of underlying estimates is. There are some variant perceptions on Fortum Oyj, with the most bullish analyst valuing it at €16.40 and the most bearish at €11.30 per share. 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 Fortum Oyj shareholders.

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Fortum Oyj's past performance and to peers in the same industry. We would also point out that the forecast 4.3% annualised revenue decline to the end of 2025 is better than the historical trend, which saw revenues shrink 43% annually 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 2.8% per year. So while a broad number of companies are forecast to grow, unfortunately Fortum Oyj is expected to see its revenue affected worse than other companies in the industry.

The Bottom Line

The biggest concern is that the analysts reduced their earnings per share estimates, suggesting business headwinds could lay ahead for Fortum Oyj. Unfortunately, they also downgraded their revenue estimates, and our data indicates underperformance compared to the wider industry. Even so, earnings per share are more important to the intrinsic value of the business. 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. At Simply Wall St, we have a full range of analyst estimates for Fortum Oyj going out to 2027, and you can see them free on our platform here..

Plus, you should also learn about the 2 warning signs we've spotted with Fortum Oyj (including 1 which 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.