PageGroup plc Earnings Missed Analyst Estimates: Here's What Analysts Are Forecasting Now

PageGroup plc (LON:PAGE) last week reported its latest full-year results, which makes it a good time for investors to dive in and see if the business is performing in line with expectations. PageGroup beat revenue expectations by 3.4%, at UK£2.0b. Statutory earnings per share (EPS) came in at UK£0.24, some 5.2% short of analyst estimates. 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. So we collected the latest post-earnings statutory consensus estimates to see what could be in store for next year.

Check out our latest analysis for PageGroup

Following last week's earnings report, PageGroup's eight analysts are forecasting 2024 revenues to be UK£2.00b, approximately in line with the last 12 months. Statutory earnings per share are expected to decrease 5.5% to UK£0.23 in the same period. Before this earnings report, the analysts had been forecasting revenues of UK£1.85b and earnings per share (EPS) of UK£0.24 in 2024. Overall it looks as though the analysts were a bit mixed on the latest results. Although there was a to revenue, the consensus also made a minor downgrade to its earnings per share forecasts.

There's been no major changes to the price target of UK£4.89, suggesting that the impact of higher forecast revenue and lower earnings won't result in a meaningful change to the business' valuation. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. Currently, the most bullish analyst values PageGroup at UK£6.00 per share, while the most bearish prices it at UK£4.10. These price targets show that analysts do have some differing views on the business, but the estimates do not vary enough to suggest to us that some are betting on wild success or utter failure.

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the PageGroup's past performance and to peers in the same industry. We would highlight that revenue is expected to reverse, with a forecast 0.5% annualised decline to the end of 2024. That is a notable change from historical growth of 6.7% over the last five years. Compare this with our data, which suggests that other companies in the same industry are, in aggregate, expected to see their revenue grow 5.8% per year. So although its revenues are forecast to shrink, this cloud does not come with a silver lining - PageGroup is expected to lag the wider industry.

The Bottom Line

The biggest concern is that the analysts reduced their earnings per share estimates, suggesting business headwinds could lay ahead for PageGroup. Fortunately, they also upgraded their revenue estimates, although our data indicates it is expected to perform worse than the wider industry. The consensus price target held steady at UK£4.89, with the latest estimates not enough to have an impact on their price targets.

Following on from that line of thought, we think that the long-term prospects of the business are much more relevant than next year's earnings. We have forecasts for PageGroup going out to 2026, and you can see them free on our platform here.

However, before you get too enthused, we've discovered 2 warning signs for PageGroup that 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.