Analyst Estimates: Here's What Brokers Think Of The Sage Group plc (LON:SGE) After Its Annual Report

The full-year results for The Sage Group plc (LON:SGE) were released last week, making it a good time to revisit its performance. It looks like the results were a bit of a negative overall. While revenues of UK£2.5b were in line with analyst predictions, statutory earnings were less than expected, missing estimates by 2.6% to hit UK£0.37 per share. The analysts typically update their forecasts at each earnings report, and we can judge from their estimates whether their view of the company has changed or if there are any new concerns to be aware of. We thought readers would find it interesting to see the analysts latest (statutory) post-earnings forecasts for next year.

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Following the latest results, Sage Group's 16 analysts are now forecasting revenues of UK£2.75b in 2026. This would be a notable 9.6% improvement in revenue compared to the last 12 months. Statutory earnings per share are predicted to expand 17% to UK£0.45. In the lead-up to this report, the analysts had been modelling revenues of UK£2.75b and earnings per share (EPS) of UK£0.44 in 2026. The consensus analysts don't seem to have seen anything in these results that would have changed their view on the business, given there's been no major change to their estimates.

Check out our latest analysis for Sage Group

The analysts reconfirmed their price target of UK£13.12, showing that the business is executing well and in line with expectations. Fixating on a single price target can be unwise though, since the consensus target is effectively the average of analyst price targets. As a result, some investors like to look at the range of estimates to see if there are any diverging opinions on the company's valuation. Currently, the most bullish analyst values Sage Group at UK£16.00 per share, while the most bearish prices it at UK£10.50. Analysts definitely have varying views on the business, but the spread of estimates is not wide enough in our view to suggest that extreme outcomes could await Sage Group shareholders.

Taking a look at the bigger picture now, one of the ways we can understand these forecasts is to see how they compare to both past performance and industry growth estimates. It's clear from the latest estimates that Sage Group's rate of growth is expected to accelerate meaningfully, with the forecast 9.6% annualised revenue growth to the end of 2026 noticeably faster than its historical growth of 6.9% p.a. over the past five years. Other similar companies in the industry (with analyst coverage) are also forecast to grow their revenue at 8.0% per year. Factoring in the forecast acceleration in revenue, it's pretty clear that Sage Group is expected to grow at about the same rate as the wider industry.

The Bottom Line

The most obvious conclusion is that there's been no major change in the business' prospects in recent times, with the analysts holding their earnings forecasts steady, in line with previous estimates. They also reconfirmed their revenue estimates, with the company predicted to grow at about the same rate as the wider industry. The consensus price target held steady at UK£13.12, 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 estimates - from multiple Sage Group analysts - going out to 2028, 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 Sage 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.