Morgan Sindall Group plc Just Recorded A 8.1% EPS Beat: Here's What Analysts Are Forecasting Next

A week ago, Morgan Sindall Group plc (LON:MGNS) came out with a strong set of yearly numbers that could potentially lead to a re-rate of the stock. The company beat expectations with revenues of UK£4.1b arriving 6.7% ahead of forecasts. Statutory earnings per share (EPS) were UK£2.50, 8.1% ahead of estimates. This is an important time for investors, as they can track a company's performance in its report, look at what experts are forecasting for next year, and see if there has been any change to expectations for the business. So we collected the latest post-earnings statutory consensus estimates to see what could be in store for next year.

See our latest analysis for Morgan Sindall Group

Following last week's earnings report, Morgan Sindall Group's five analysts are forecasting 2024 revenues to be UK£4.05b, approximately in line with the last 12 months. Statutory earnings per share are expected to sink 10% to UK£2.27 in the same period. Before this earnings report, the analysts had been forecasting revenues of UK£3.92b and earnings per share (EPS) of UK£2.29 in 2024. So it looks like there's been no major change in sentiment following the latest results, although the analysts have made a slight bump in to revenue forecasts.

It may not be a surprise to see thatthe analysts have reconfirmed their price target of UK£25.68, implying that the uplift in revenue is not expected to greatly contribute to Morgan Sindall Group's valuation in the near term. 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. There are some variant perceptions on Morgan Sindall Group, with the most bullish analyst valuing it at UK£27.60 and the most bearish at UK£24.00 per share. Still, with such a tight range of estimates, it suggeststhe analysts have a pretty good idea of what they think the company is worth.

Of course, another way to look at these forecasts is to place them into context against the industry itself. These estimates imply that revenue is expected to slow, with a forecast annualised decline of 1.7% by the end of 2024. This indicates a significant reduction from annual growth of 6.4% over the last five years. By contrast, our data suggests that other companies (with analyst coverage) in the same industry are forecast to see their revenue grow 2.5% annually for the foreseeable future. It's pretty clear that Morgan Sindall Group's revenues are expected to perform substantially worse than the wider industry.

The Bottom Line

The most important thing to take away is that there's been no major change in sentiment, with the analysts reconfirming that the business is performing in line with their previous earnings per share estimates. Fortunately, they also upgraded their revenue estimates, although our data indicates it 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 in mind, we wouldn't be too quick to come to a conclusion on Morgan Sindall Group. Long-term earnings power is much more important than next year's profits. We have forecasts for Morgan Sindall Group going out to 2026, and you can see them free on our platform here.

You should always think about risks though. Case in point, we've spotted 1 warning sign for Morgan Sindall Group you should be aware of.

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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.