Earnings Miss: Teleperformance SE Missed EPS By 24% And Analysts Are Revising Their Forecasts

Teleperformance SE (EPA:TEP) shareholders are probably feeling a little disappointed, since its shares fell 8.2% to €92.66 in the week after its latest full-year results. It looks like a pretty bad result, all things considered. Although revenues of €10b were in line with analyst predictions, statutory earnings fell badly short, missing estimates by 24% to hit €8.71 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. We thought readers would find it interesting to see the analysts latest (statutory) post-earnings forecasts for next year.

See our latest analysis for Teleperformance

Following the latest results, Teleperformance's 15 analysts are now forecasting revenues of €10.7b in 2025. This would be a modest 4.3% improvement in revenue compared to the last 12 months. Per-share earnings are expected to soar 44% to €12.77. Yet prior to the latest earnings, the analysts had been anticipated revenues of €10.7b and earnings per share (EPS) of €13.03 in 2025. So it looks like there's been a small decline in overall sentiment after the recent results - there's been no major change to revenue estimates, but the analysts did make a minor downgrade to their earnings per share forecasts.

The consensus price target held steady at €141, with the analysts seemingly voting that their lower forecast earnings are not expected to lead to a lower stock price in the foreseeable future. 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 Teleperformance, with the most bullish analyst valuing it at €210 and the most bearish at €95.00 per share. 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.

Of course, another way to look at these forecasts is to place them into context against the industry itself. We would highlight that Teleperformance's revenue growth is expected to slow, with the forecast 4.3% annualised growth rate until the end of 2025 being well below the historical 13% p.a. growth over the last five years. Juxtapose this against the other companies in the industry with analyst coverage, which are forecast to grow their revenues (in aggregate) 5.1% annually. Factoring in the forecast slowdown in growth, it looks like Teleperformance is forecast to grow at about the same rate as the wider industry.

The Bottom Line

The biggest concern is that the analysts reduced their earnings per share estimates, suggesting business headwinds could lay ahead for Teleperformance. Happily, there were no real changes to revenue forecasts, with the business still expected to grow in line with the overall 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.

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. We have forecasts for Teleperformance going out to 2027, and you can see them free on our platform here.

However, before you get too enthused, we've discovered 1 warning sign for Teleperformance that you should be aware of.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

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.