These Analysts Just Made A Meaningful Downgrade To Their Tikehau Capital (EPA:TKO) EPS Forecasts

Market forces rained on the parade of Tikehau Capital (EPA:TKO) shareholders today, when the analysts downgraded their forecasts for this year. Revenue and earnings per share (EPS) forecasts were both revised downwards, with analysts seeing grey clouds on the horizon.

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Following the downgrade, the most recent consensus for Tikehau Capital from its five analysts is for revenues of €682m in 2025 which, if met, would be a huge 22% increase on its sales over the past 12 months. Per-share earnings are expected to bounce 44% to €1.30. Previously, the analysts had been modelling revenues of €761m and earnings per share (EPS) of €1.84 in 2025. Indeed, we can see that the analysts are a lot more bearish about Tikehau Capital's prospects, administering a substantial drop in revenue estimates and slashing their EPS estimates to boot.

Check out our latest analysis for Tikehau Capital

Analysts made no major changes to their price target of €25.28, suggesting the downgrades are not expected to have a long-term impact on Tikehau Capital's valuation.

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Tikehau Capital's past performance and to peers in the same industry. It's clear from the latest estimates that Tikehau Capital's rate of growth is expected to accelerate meaningfully, with the forecast 22% annualised revenue growth to the end of 2025 noticeably faster than its historical growth of 8.7% p.a. over the past five years. Compare this with other companies in the same industry, which are forecast to see a revenue decline of 8.4% annually. It seems obvious that as part of the brighter growth outlook, Tikehau Capital is expected to grow faster than the wider industry.

The Bottom Line

The most important thing to take away is that analysts cut their earnings per share estimates, expecting a clear decline in business conditions. Unfortunately, they also downgraded their revenue estimates, and our data indicates sales are expected to outperform the wider market. Even so, earnings per share are more important to the intrinsic value of the business. We're also surprised to see that the price target went unchanged. Still, deteriorating business conditions (assuming accurate forecasts!) can be a leading indicator for the stock price, so we wouldn't blame investors for being more cautious on Tikehau Capital after the downgrade.

Not only have the analysts been downgrading the stock, but it looks like Tikehau Capital might find it hard to maintain its dividends, if these forecasts prove accurate. What makes us say that? Learn more by visiting our risks dashboard 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 downgrading their estimates. So you may also wish to search this free list of stocks with high insider ownership.

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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.