Kaufman & Broad S.A. (EPA:KOF) Yearly Results: Here's What Analysts Are Forecasting For This Year

Last week, you might have seen that Kaufman & Broad S.A. (EPA:KOF) released its full-year result to the market. The early response was not positive, with shares down 4.4% to €28.35 in the past week. Kaufman & Broad reported €1.4b in revenue, roughly in line with analyst forecasts, although statutory earnings per share (EPS) of €3.03 beat expectations, being 4.9% higher than what the analysts expected. Following the result, the analysts have updated their earnings model, and it would be good to know whether they think there's been a strong change in the company's prospects, or if it's business as usual. So we gathered the latest post-earnings forecasts to see what estimates suggest is in store for next year.

See our latest analysis for Kaufman & Broad

Following the recent earnings report, the consensus from six analysts covering Kaufman & Broad is for revenues of €1.15b in 2024. This implies a not inconsiderable 18% decline in revenue compared to the last 12 months. Statutory earnings per share are expected to tumble 37% to €1.94 in the same period. In the lead-up to this report, the analysts had been modelling revenues of €1.18b and earnings per share (EPS) of €2.16 in 2024. The analysts seem less optimistic after the recent results, reducing their revenue forecasts and making a substantial drop in earnings per share numbers.

Despite the cuts to forecast earnings, there was no real change to the €31.60 price target, showing that the analysts don't think the changes have a meaningful impact on its intrinsic value. That's not the only conclusion we can draw from this data however, as some investors also like to consider the spread in estimates when evaluating analyst price targets. The most optimistic Kaufman & Broad analyst has a price target of €36.00 per share, while the most pessimistic values it at €29.30. Still, with such a tight range of estimates, it suggeststhe analysts have a pretty good idea of what they think the company is worth.

Of course, another way to look at these forecasts is to place them into context against the industry itself. Over the past five years, revenues have declined around 0.2% annually. Worse, forecasts are essentially predicting the decline to accelerate, with the estimate for an annualised 18% decline in revenue until the end of 2024. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to see their revenue grow 3.2% per year. So it's pretty clear that, while it does have declining revenues, the analysts also expect Kaufman & Broad to suffer worse than the wider industry.

The Bottom Line

The most important thing to take away is that the analysts downgraded their earnings per share estimates, showing that there has been a clear decline in sentiment following these results. On the negative side, they also downgraded their revenue estimates, and forecasts imply they will perform worse than the wider 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 estimates - from multiple Kaufman & Broad analysts - going out to 2025, and you can see them free on our platform here.

We don't want to rain on the parade too much, but we did also find 2 warning signs for Kaufman & Broad (1 makes us a bit uncomfortable!) that you need to be mindful of.

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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.