Earnings Release: Here's Why Analysts Cut Their Jacquet Metals SA (EPA:JCQ) Price Target To €18.55

The half-yearly results for Jacquet Metals SA (EPA:JCQ) were released last week, making it a good time to revisit its performance. It was a credible result overall, with revenues of €1.1b and statutory earnings per share of €2.26 both in line with analyst estimates, showing that Jacquet Metals is executing in line with expectations. 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. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether the analysts have changed their mind on Jacquet Metals after the latest results.

View our latest analysis for Jacquet Metals

After the latest results, the consensus from Jacquet Metals' three analysts is for revenues of €1.97b in 2024, which would reflect a small 3.1% decline in revenue compared to the last year of performance. Statutory earnings per share are predicted to jump 119% to €0.52. Yet prior to the latest earnings, the analysts had been anticipated revenues of €2.05b and earnings per share (EPS) of €0.30 in 2024. While revenue forecasts have been revised downwards, the analysts look to have become more optimistic on the company's cost base, given the great increase in to the earnings per share numbers.

The consensus price target fell 9.5% to €18.55, with the analysts signalling that the weaker revenue outlook was a more powerful indicator than the upgraded EPS forecasts. 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. Currently, the most bullish analyst values Jacquet Metals at €26.00 per share, while the most bearish prices it at €14.70. Note the wide gap in analyst price targets? This implies to us that there is a fairly broad range of possible scenarios for the underlying business.

One way to get more context on these forecasts is to look at how they compare to both past performance, and how other companies in the same industry are performing. These estimates imply that revenue is expected to slow, with a forecast annualised decline of 6.1% by the end of 2024. This indicates a significant reduction from annual growth of 11% over the last five years. Compare this with our data, which suggests that other companies in the same industry are, in aggregate, expected to see their revenue grow 2.9% per year. It's pretty clear that Jacquet Metals' revenues are expected to perform substantially worse than the wider industry.

The Bottom Line

The biggest takeaway for us is the consensus earnings per share upgrade, which suggests a clear improvement in sentiment around Jacquet Metals' earnings potential next year. On the negative side, they also downgraded their revenue estimates, and forecasts imply they will perform worse than the wider industry. Even so, long term profitability is more important for the value creation process. The consensus price target fell measurably, with the analysts seemingly not reassured by the latest results, leading to a lower estimate of Jacquet Metals' future valuation.

With that said, the long-term trajectory of the company's earnings is a lot more important than next year. We have forecasts for Jacquet Metals going out to 2026, and you can see them free on our platform here.

Even so, be aware that Jacquet Metals is showing 1 warning sign in our investment analysis , you should know about...

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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.