Vantiva S.A. (EPA:VANTI) Analysts Just Cut Their EPS Forecasts Substantially

One thing we could say about the analysts on Vantiva S.A. (EPA:VANTI) - they aren't optimistic, having just made a major negative revision to their near-term (statutory) forecasts for the organization. Revenue and earnings per share (EPS) forecasts were both revised downwards, with the analysts seeing grey clouds on the horizon.

Following the downgrade, the consensus from three analysts covering Vantiva is for revenues of €2.1b in 2023, implying an uneasy 19% decline in sales compared to the last 12 months. The loss per share is anticipated to greatly reduce in the near future, narrowing 90% to €0.20. Yet before this consensus update, the analysts had been forecasting revenues of €2.6b and losses of €0.17 per share in 2023. Ergo, there's been a clear change in sentiment, with the analysts administering a notable cut to this year's revenue estimates, while at the same time increasing their loss per share forecasts.

Check out our latest analysis for Vantiva

The consensus price target fell 18% to €0.23, implicitly signalling that lower earnings per share are a leading indicator for Vantiva's valuation.

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. Over the past five years, revenues have declined around 12% annually. Worse, forecasts are essentially predicting the decline to accelerate, with the estimate for an annualised 35% decline in revenue until the end of 2023. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to see their revenue grow 9.0% per year. So it's pretty clear that, while it does have declining revenues, the analysts also expect Vantiva to suffer worse than the wider industry.

The Bottom Line

The most important thing to note from this downgrade is that the consensus increased its forecast losses this year, suggesting all may not be well at Vantiva. Regrettably, they also downgraded their revenue estimates, and the latest forecasts imply the business will grow sales slower than the wider market. After such a stark change in sentiment from analysts, we'd understand if readers now felt a bit wary of Vantiva.

Still, the long-term prospects of the business are much more relevant than next year's earnings. At Simply Wall St, we have a full range of analyst estimates for Vantiva going out to 2025, and you can see them free on our platform here.

Another way to search for interesting companies that could be reaching an inflection point is to track whether management are buying or selling, with our free list of growing companies that insiders are buying.

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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.