Need To Know: Analysts Are Much More Bullish On M.P. Evans Group PLC (LON:MPE) Revenues

Shareholders in M.P. Evans Group PLC (LON:MPE) may be thrilled to learn that the analysts have just delivered a major upgrade to their near-term forecasts. The consensus estimated revenue numbers rose, with their view now clearly much more bullish on the company's business prospects. Investor sentiment seems to be improving too, with the share price up 8.5% to UK£10.65 over the past 7 days. Whether the upgrade is enough to drive the stock price higher is yet to be seen, however.

Following the upgrade, the latest consensus from M.P. Evans Group's twin analysts is for revenues of US$298m in 2022, which would reflect a reasonable 7.9% improvement in sales compared to the last 12 months. Prior to the latest estimates, the analysts were forecasting revenues of US$236m in 2022. It looks like there's been a clear increase in optimism around M.P. Evans Group, given the considerable lift to revenue forecasts.

View our latest analysis for M.P. Evans Group

The consensus price target rose 5.2% to US$14.78, with the analysts clearly more optimistic about M.P. Evans Group's prospects following this update. 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 M.P. Evans Group at US$11.48 per share, while the most bearish prices it at US$11.09. With such a narrow range of valuations, analysts apparently share similar views on what they think the business is worth.

Looking at the bigger picture now, one of the ways we can make sense of these forecasts is to see how they measure up against both past performance and industry growth estimates. We would highlight that M.P. Evans Group's revenue growth is expected to slow, with the forecast 7.9% annualised growth rate until the end of 2022 being well below the historical 21% p.a. growth over the last five years. By way of comparison, the other companies in this industry with analyst coverage are forecast to grow their revenue at 5.6% annually. Even after the forecast slowdown in growth, it seems obvious that M.P. Evans Group is also expected to grow faster than the wider industry.

The Bottom Line

The most important thing to take away from this upgrade is that analysts lifted their revenue estimates for this year. Analysts also expect revenues to grow faster than the wider market. There was also a nice increase in the price target, with analysts apparently feeling that the intrinsic value of the business is improving. Given that analysts appear to be expecting substantial improvement in the sales pipeline, now could be the right time to take another look at M.P. Evans Group.

Unsatisfied? At least one of M.P. Evans Group's twin analysts has provided estimates out to 2024, which can be seen for 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.