UK£1.57: That's What Analysts Think Synthomer plc (LON:SYNT) Is Worth After Its Latest Results

There's been a major selloff in Synthomer plc (LON:SYNT) shares in the week since it released its half-year report, with the stock down 23% to UK£0.62. Revenues were UK£925m, with Synthomer reporting some 6.8% below analyst expectations. 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. With this in mind, we've gathered the latest statutory forecasts to see what the analysts are expecting for next year.

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Taking into account the latest results, Synthomer's six analysts currently expect revenues in 2025 to be UK£1.86b, approximately in line with the last 12 months. Losses are predicted to fall substantially, shrinking 33% to UK£0.31. Before this latest report, the consensus had been expecting revenues of UK£1.96b and UK£0.24 per share in losses. While this year's revenue estimates dropped there was also a considerable increase to loss per share expectations, suggesting the consensus has a bit of a mixed view on the stock.

See our latest analysis for Synthomer

The consensus price target fell 6.7% to UK£1.57, with the analysts clearly concerned about the company following the weaker revenue and earnings outlook. 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 Synthomer at UK£3.66 per share, while the most bearish prices it at UK£0.70. So we wouldn't be assigning too much credibility to analyst price targets in this case, because there are clearly some widely different views on what kind of performance this business can generate. With this in mind, we wouldn't rely too heavily the consensus price target, as it is just an average and analysts clearly have some deeply divergent views on the business.

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. These estimates imply that revenue is expected to slow, with a forecast annualised decline of 2.6% by the end of 2025. This indicates a significant reduction from annual growth of 2.0% over the last five years. By contrast, our data suggests that other companies (with analyst coverage) in the industry are forecast to see their revenue decline 16% annually for the foreseeable future. So it's pretty clear that Synthomer's revenues are expected to shrink slower than the wider industry.

The Bottom Line

The most important thing to note is the forecast of increased losses next year, suggesting all may not be well at Synthomer. Sadly they also cut their revenue estimates, although at least the company is expected to perform a bit better than the wider industry. The consensus price target fell measurably, with the analysts seemingly not reassured by the latest results, leading to a lower estimate of Synthomer's future valuation.

With that in mind, we wouldn't be too quick to come to a conclusion on Synthomer. Long-term earnings power is much more important than next year's profits. At Simply Wall St, we have a full range of analyst estimates for Synthomer going out to 2027, and you can see them free on our platform here..

It is also worth noting that we have found 2 warning signs for Synthomer (1 is concerning!) that you need to take into consideration.

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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.