Brokers Are Upgrading Their Views On Rothschild & Co SCA (EPA:ROTH) With These New Forecasts

Rothschild & Co SCA (EPA:ROTH) shareholders will have a reason to smile today, with the analysts making substantial upgrades to this year's forecasts. The analysts greatly increased their revenue estimates, suggesting a stark improvement in business fundamentals. Investors have been pretty optimistic on Rothschild & Co too, with the stock up 12% to €33.35 over the past week. Could this upgrade be enough to drive the stock even higher?

After this upgrade, Rothschild & Co's three analysts are now forecasting revenues of €2.2b in 2021. This would be a decent 17% improvement in sales compared to the last 12 months. Statutory earnings per share are presumed to surge 90% to €4.17. Before this latest update, the analysts had been forecasting revenues of €2.0b and earnings per share (EPS) of €3.36 in 2021. So we can see there's been a pretty clear increase in analyst sentiment in recent times, with both revenues and earnings per share receiving a decent lift in the latest estimates.

Check out our latest analysis for Rothschild & Co

It will come as no surprise to learn that the analysts have increased their price target for Rothschild & Co 6.3% to €38.73 on the back of these upgrades. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. There are some variant perceptions on Rothschild & Co, with the most bullish analyst valuing it at €40.00 and the most bearish at €37.20 per share. The narrow spread of estimates could suggest that the business' future is relatively easy to value, or that the analysts have a clear view on its prospects.

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. The analysts are definitely expecting Rothschild & Co's growth to accelerate, with the forecast 17% annualised growth to the end of 2021 ranking favourably alongside historical growth of 3.2% per annum 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 4.1% per year. It seems obvious that, while the growth outlook is brighter than the recent past, the analysts also expect Rothschild & Co to grow faster than the wider industry.

The Bottom Line

The biggest takeaway for us from these new estimates is that analysts upgraded their earnings per share estimates, with improved earnings power expected for this year. Fortunately, analysts also upgraded their revenue estimates, and our data indicates sales are expected to perform better than the wider market. With a serious upgrade to expectations and a rising price target, it might be time to take another look at Rothschild & Co.

Even so, the longer term trajectory of the business is much more important for the value creation of shareholders. We have estimates - from multiple Rothschild & Co analysts - going out to 2023, and you can see them 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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