Ipsos SA (EPA:IPS) Just Released Its Interim Results And Analysts Are Updating Their Estimates

Last week, you might have seen that Ipsos SA (EPA:IPS) released its interim result to the market. The early response was not positive, with shares down 6.0% to €57.60 in the past week. Ipsos reported in line with analyst predictions, delivering revenues of €1.1b and statutory earnings per share of €3.59, suggesting the business is executing well and in line with its plan. 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. We thought readers would find it interesting to see the analysts latest (statutory) post-earnings forecasts for next year.

View our latest analysis for Ipsos

Taking into account the latest results, Ipsos' six analysts currently expect revenues in 2024 to be €2.48b, approximately in line with the last 12 months. Statutory earnings per share are predicted to ascend 19% to €5.00. Yet prior to the latest earnings, the analysts had been anticipated revenues of €2.51b and earnings per share (EPS) of €5.14 in 2024. 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.

It might be a surprise to learn that the consensus price target was broadly unchanged at €76.25, with the analysts clearly implying that the forecast decline in earnings is not expected to have much of an impact on valuation. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. Currently, the most bullish analyst values Ipsos at €89.00 per share, while the most bearish prices it at €68.00. With such a narrow range of valuations, the analysts apparently share similar views on what they think the business is worth.

One way to get more context on these forecasts is to look at how they compare to both past performance, and how other companies in the same industry are performing. We would highlight that Ipsos' revenue growth is expected to slow, with the forecast 3.3% annualised growth rate until the end of 2024 being well below the historical 6.2% p.a. growth over the last five years. Compare this to the 32 other companies in this industry with analyst coverage, which are forecast to grow their revenue at 3.9% per year. So it's pretty clear that, while Ipsos' revenue growth is expected to slow, it's expected to grow roughly in line with the industry.

The Bottom Line

The biggest concern is that the analysts reduced their earnings per share estimates, suggesting business headwinds could lay ahead for Ipsos. They also reconfirmed their revenue estimates, with the company predicted to grow at about the same rate as 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 Ipsos analysts - going out to 2026, and you can see them free on our platform here.

You should always think about risks though. Case in point, we've spotted 1 warning sign for Ipsos you should be aware 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.

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