€5.45: That's What Analysts Think 2CRSI S.A. (EPA:2CRSI) Is Worth After Its Latest Results

Shareholders of 2CRSI S.A. (EPA:2CRSI) will be pleased this week, given that the stock price is up 12% to €3.35 following its latest full-year results. It was an okay report, and revenues came in at €184m, approximately in line with analyst estimates leading up to the results announcement. 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.

See our latest analysis for 2CRSI

Taking into account the latest results, the consensus forecast from 2CRSI's twin analysts is for revenues of €202.0m in 2023, which would reflect a solid 10% improvement in sales compared to the last 12 months. Earnings are expected to improve, with 2CRSI forecast to report a statutory profit of €0.06 per share. Before this earnings report, the analysts had been forecasting revenues of €202.4m and earnings per share (EPS) of €0.18 in 2023. The analysts seem to have become more bearish following the latest results. While there were no changes to revenue forecasts, there was a large cut to EPS estimates.

It might be a surprise to learn that the consensus price target fell 8.4% to €5.45, with the analysts clearly linking lower forecast earnings to the performance of the stock price.

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. We would highlight that 2CRSI's revenue growth is expected to slow, with the forecast 10% annualised growth rate until the end of 2023 being well below the historical 37% p.a. growth over the last three years. Juxtapose this against the other companies in the industry with analyst coverage, which are forecast to grow their revenues (in aggregate) 7.8% per year. So it's pretty clear that, while 2CRSI's revenue growth is expected to slow, it's still expected to grow faster than the industry itself.

The Bottom Line

The biggest concern is that the analysts reduced their earnings per share estimates, suggesting business headwinds could lay ahead for 2CRSI. Fortunately, they also reconfirmed their revenue numbers, suggesting sales are tracking in line with expectations - and our data suggests that revenues are expected to grow faster than the wider industry. Furthermore, the analysts also cut their price targets, suggesting that the latest news has led to greater pessimism about the intrinsic value of the business.

With that in mind, we wouldn't be too quick to come to a conclusion on 2CRSI. Long-term earnings power is much more important than next year's profits. We have analyst estimates for 2CRSI going out as far as 2024, and you can see them free on our platform here.

However, before you get too enthused, we've discovered 2 warning signs for 2CRSI that you should be aware of.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

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.