Derichebourg SA (EPA:DBG) Released Earnings Last Week And Analysts Lifted Their Price Target To €3.92

The investors in Derichebourg SA's (EPA:DBG) will be rubbing their hands together with glee today, after the share price leapt 28% to €4.34 in the week following its annual results. Revenues were €2.5b, with Derichebourg reporting some 3.1% below analyst expectations. 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.

View our latest analysis for Derichebourg

Taking into account the latest results, the current consensus from Derichebourg's four analysts is for revenues of €2.71b in 2021, which would reflect a meaningful 10% increase on its sales over the past 12 months. Statutory earnings per share are forecast to drop 15% to €0.25 in the same period. Before this earnings report, the analysts had been forecasting revenues of €2.68b and earnings per share (EPS) of €0.23 in 2021. The analysts seems to have become more bullish on the business, judging by their new earnings per share estimates.

The consensus price target rose 11% to €3.92, suggesting that higher earnings estimates flow through to the stock's valuation as well. 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 Derichebourg analyst has a price target of €5.00 per share, while the most pessimistic values it at €2.80. 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 Derichebourg shareholders.

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Derichebourg's past performance and to peers in the same industry. It's clear from the latest estimates that Derichebourg's rate of growth is expected to accelerate meaningfully, with the forecast 10% revenue growth noticeably faster than its historical growth of 3.5%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 5.1% per year. It seems obvious that, while the growth outlook is brighter than the recent past, the analysts also expect Derichebourg to grow faster than the wider 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 Derichebourg following these results. Fortunately, they also reconfirmed their revenue numbers, suggesting sales are tracking in line with expectations - and our data suggests that revenues are expected to grow faster than the wider industry. We note an upgrade to the price target, suggesting that the analysts believes the intrinsic value of the business is likely to improve over time.

With that said, the long-term trajectory of the company's earnings is a lot more important than next year. We have forecasts for Derichebourg going out to 2022, and you can see them free on our platform here.

You should always think about risks though. Case in point, we've spotted 4 warning signs for Derichebourg you should be aware of.

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