Investors in Keller Group plc (LON:KLR) had a good week, as its shares rose 4.6% to close at UK£13.74 following the release of its full-year results. Revenues were UK£3.0b, approximately in line with expectations, although statutory earnings per share (EPS) performed substantially better. EPS of UK£1.93 were also better than expected, beating analyst predictions by 12%. 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. With this in mind, we've gathered the latest statutory forecasts to see what the analysts are expecting for next year.
View our latest analysis for Keller Group
Taking into account the latest results, the current consensus from Keller Group's five analysts is for revenues of UK£3.06b in 2025. This would reflect a reasonable 2.3% increase on its revenue over the past 12 months. Statutory earnings per share are forecast to dip 2.5% to UK£1.92 in the same period. Before this earnings report, the analysts had been forecasting revenues of UK£3.13b and earnings per share (EPS) of UK£1.77 in 2025. So it's pretty clear that while sentiment around revenues has declined following the latest results, the analysts are now more bullish on the company's earnings power.
The consensus has made no major changes to the price target of UK£19.58, suggesting the forecast improvement in earnings is expected to offset the decline in revenues next year. 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. Currently, the most bullish analyst values Keller Group at UK£22.50 per share, while the most bearish prices it at UK£18.00. The narrow spread of estimates could suggest that the business' future is relatively easy to value, or thatthe analysts have a strong view on its prospects.
Of course, another way to look at these forecasts is to place them into context against the industry itself. We would highlight that Keller Group's revenue growth is expected to slow, with the forecast 2.3% annualised growth rate until the end of 2025 being well below the historical 8.9% p.a. growth over the last five years. Compare this against other companies (with analyst forecasts) in the industry, which are in aggregate expected to see revenue growth of 4.5% annually. Factoring in the forecast slowdown in growth, it seems obvious that Keller Group is also expected to grow slower than other industry participants.
The Bottom Line
The biggest takeaway for us is the consensus earnings per share upgrade, which suggests a clear improvement in sentiment around Keller Group's earnings potential next year. On the negative side, they also downgraded their revenue estimates, and forecasts imply they will perform worse than the wider industry. With that said, earnings are more important to the long-term value of the business. The consensus price target held steady at UK£19.58, with the latest estimates not enough to have an impact on their price targets.
Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. We have estimates - from multiple Keller Group analysts - going out to 2027, and you can see them free on our platform here.
You can also view our analysis of Keller Group's balance sheet, and whether we think Keller Group is carrying too much debt, for free on our platform here.
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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.