Stock Analysis

Results: Bank of Georgia Group PLC Beat Earnings Expectations And Analysts Now Have New Forecasts

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It's been a sad week for Bank of Georgia Group PLC (LON:BGEO), who've watched their investment drop 15% to UK£13.26 in the week since the company reported its annual result. The result was positive overall - although revenues of GEL1.3b were in line with what the analysts predicted, Bank of Georgia Group surprised by delivering a statutory profit of GEL15.40 per share, modestly greater than expected. 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 Bank of Georgia Group after the latest results.

View our latest analysis for Bank of Georgia Group

LSE:BGEO Earnings and Revenue Growth February 25th 2022

After the latest results, the six analysts covering Bank of Georgia Group are now predicting revenues of GEL1.59b in 2022. If met, this would reflect a sizeable 21% improvement in sales compared to the last 12 months. Per-share earnings are expected to rise 5.9% to GEL16.30. Before this earnings report, the analysts had been forecasting revenues of GEL1.50b and earnings per share (EPS) of GEL13.80 in 2022. There's been a pretty noticeable increase in sentiment, with the analysts upgrading revenues and making a nice gain to earnings per share in particular.

Althoughthe analysts have upgraded their earnings estimates, there was no change to the consensus price target of UK£21.35, suggesting that the forecast performance does not have a long term impact on the company's valuation. The consensus price target is just an average of individual analyst targets, so - it could be handy to see how wide the range of underlying estimates is. There are some variant perceptions on Bank of Georgia Group, with the most bullish analyst valuing it at UK£27.90 and the most bearish at UK£14.00 per share. Note the wide gap in analyst price targets? This implies to us that there is a fairly broad range of possible scenarios for the underlying business.

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. The analysts are definitely expecting Bank of Georgia Group's growth to accelerate, with the forecast 21% annualised growth to the end of 2022 ranking favourably alongside historical growth of 12% per annum over the past five years. Compare this with other companies in the same industry, which are forecast to grow their revenue 4.4% annually. It seems obvious that, while the growth outlook is brighter than the recent past, the analysts also expect Bank of Georgia Group to grow faster than the wider industry.

The Bottom Line

The biggest takeaway for us is the consensus earnings per share upgrade, which suggests a clear improvement in sentiment around Bank of Georgia Group's earnings potential next year. Happily, they also upgraded their revenue estimates, and are forecasting revenues to grow faster than the wider industry. The consensus price target held steady at UK£21.35, with the latest estimates not enough to have an impact on their price targets.

With that said, the long-term trajectory of the company's earnings is a lot more important than next year. At Simply Wall St, we have a full range of analyst estimates for Bank of Georgia Group going out to 2024, and you can see them free on our platform here..

You should always think about risks though. Case in point, we've spotted 2 warning signs for Bank of Georgia Group you should be aware of.

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