The Ubisoft Entertainment SA (EPA:UBI) Half-Year Results Are Out And Analysts Have Published New Forecasts

It's been a good week for Ubisoft Entertainment SA (EPA:UBI) shareholders, because the company has just released its latest interim results, and the shares gained 3.1% to €14.18. It was a pretty bad result overall; while revenues were in line with expectations at €642m, statutory losses exploded to €1.94 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. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether the analysts have changed their mind on Ubisoft Entertainment after the latest results.

See our latest analysis for Ubisoft Entertainment

Following the recent earnings report, the consensus from 19 analysts covering Ubisoft Entertainment is for revenues of €1.95b in 2025. This implies a chunky 9.0% decline in revenue compared to the last 12 months. Losses are forecast to balloon 90% to €0.79 per share. Before this earnings announcement, the analysts had been modelling revenues of €1.97b and losses of €0.45 per share in 2025. While this year's revenue estimates held steady, there was also a regrettable increase in loss per share expectations, suggesting the consensus has a bit of a mixed view on the stock.

The consensus price target held steady at €16.89, seemingly implying that the higher forecast losses are not expected to have a long term impact on the company's valuation. There's another way to think about price targets though, and that's to look at the range of price targets put forward by analysts, because a wide range of estimates could suggest a diverse view on possible outcomes for the business. Currently, the most bullish analyst values Ubisoft Entertainment at €30.00 per share, while the most bearish prices it at €10.00. As you can see the range of estimates is wide, with the lowest valuation coming in at less than half the most bullish estimate, suggesting there are some strongly diverging views on how analysts think this business will perform. As a result it might not be a great idea to make decisions based on the consensus price target, which is after all just an average of this wide range of estimates.

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. These estimates imply that revenue is expected to slow, with a forecast annualised decline of 17% by the end of 2025. This indicates a significant reduction from annual growth of 4.2% over the last five years. Compare this with our data, which suggests that other companies in the same industry are, in aggregate, expected to see their revenue grow 8.2% per year. So although its revenues are forecast to shrink, this cloud does not come with a silver lining - Ubisoft Entertainment is expected to lag the wider industry.

The Bottom Line

The most important thing to take away is that the analysts increased their loss per share estimates for next year. Fortunately, the analysts also reconfirmed their revenue estimates, suggesting that it's tracking in line with expectations. Although our data does suggest that Ubisoft Entertainment's revenue is expected to 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.

With that said, the long-term trajectory of the company's earnings is a lot more important than next year. We have forecasts for Ubisoft Entertainment going out to 2027, and you can see them free on our platform here.

It is also worth noting that we have found 3 warning signs for Ubisoft Entertainment (2 shouldn't be ignored!) that you need to take into consideration.

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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.