New Forecasts: Here's What Analysts Think The Future Holds For Balyo SA (EPA:BALYO)

Celebrations may be in order for Balyo SA (EPA:BALYO) shareholders, with the covering analyst delivering a significant upgrade to their statutory estimates for the company. The consensus statutory numbers for both revenue and earnings per share (EPS) increased, with their view clearly much more bullish on the company's business prospects. The market may be pricing in some blue sky too, with the share price gaining 19% to €0.57 in the last 7 days. We'll be curious to see if these new estimates convince the market to lift the stock price higher still.

After the upgrade, the solo analyst covering Balyo is now predicting revenues of €29m in 2023. If met, this would reflect a sizeable 42% improvement in sales compared to the last 12 months. Losses are predicted to fall substantially, shrinking 72% to €0.05. Yet prior to the latest estimates, the analyst had been forecasting revenues of €24m and losses of €0.11 per share in 2023. So there's been quite a change-up of views after the recent consensus updates, with the analyst making a sizeable increase to their revenue forecasts while also reducing the estimated loss as the business grows towards breakeven.

Check out our latest analysis for Balyo

It will come as no surprise to learn that the analyst has increased their price target for Balyo 40% to €0.70 on the back of these upgrades.

Another way we can view these estimates is in the context of the bigger picture, such as how the forecasts stack up against past performance, and whether forecasts are more or less bullish relative to other companies in the industry. It's clear from the latest estimates that Balyo's rate of growth is expected to accelerate meaningfully, with the forecast 33% annualised revenue growth to the end of 2023 noticeably faster than its historical growth of 6.2% 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 9.1% per year. Factoring in the forecast acceleration in revenue, it's pretty clear that Balyo is expected to grow much faster than its industry.

The Bottom Line

The most important thing here is that the analyst reduced their loss per share estimates for next year, reflecting increased optimism around Balyo's prospects. They also upgraded their revenue estimates for next year, and sales are expected to grow faster than the wider market. Given that the consensus looks almost universally bullish, with a substantial increase to forecasts and a higher price target, Balyo could be worth investigating further.

These earnings upgrades look like a sterling endorsement, but before diving in - you should know that we've spotted 5 potential risks with Balyo, including a short cash runway. You can learn more, and discover the 3 other risks we've identified, for free on our platform here.

Of course, seeing company management invest large sums of money in a stock can be just as useful as knowing whether analysts are upgrading their estimates. So you may also wish to search this free list of stocks that insiders are buying.

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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.