Analyst Estimates: Here's What Brokers Think Of Richter Gedeon Vegyészeti Gyár Nyilvánosan Muködo Rt. (BUSE:RICHTER) After Its First-Quarter Report

Last week, you might have seen that Richter Gedeon Vegyészeti Gyár Nyilvánosan Muködo Rt. (BUSE:RICHTER) released its first-quarter result to the market. The early response was not positive, with shares down 2.2% to Ft8,385 in the past week. Results look mixed - while revenue fell marginally short of analyst estimates at Ft141b, statutory earnings were in line with expectations, at Ft563 per share. 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. We've gathered the most recent statutory forecasts to see whether the analysts have changed their earnings models, following these results.

Check out our latest analysis for Richter Gedeon Vegyészeti Gyár Nyilvánosan Muködo Rt

Following the latest results, Richter Gedeon Vegyészeti Gyár Nyilvánosan Muködo Rt's nine analysts are now forecasting revenues of Ft594.4b in 2021. This would be an okay 4.9% improvement in sales compared to the last 12 months. Statutory per-share earnings are expected to be Ft574, roughly flat on the last 12 months. In the lead-up to this report, the analysts had been modelling revenues of Ft601.5b and earnings per share (EPS) of Ft605 in 2021. The analysts seem to have become a little more negative on the business after the latest results, given the minor downgrade to their earnings per share numbers for next year.

The consensus price target held steady at Ft9,251, with the analysts seemingly voting that their lower forecast earnings are not expected to lead to a lower stock price in the foreseeable future. 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. The most optimistic Richter Gedeon Vegyészeti Gyár Nyilvánosan Muködo Rt analyst has a price target of Ft11,300 per share, while the most pessimistic values it at Ft5,788. There are definitely some different views on the stock, but the range of estimates is not wide enough as to imply that the situation is unforecastable, in our view.

One way to get more context on these forecasts is to look at how they compare to both past performance, and how other companies in the same industry are performing. We would highlight that Richter Gedeon Vegyészeti Gyár Nyilvánosan Muködo Rt's revenue growth is expected to slow, with the forecast 6.6% annualised growth rate until the end of 2021 being well below the historical 8.7% 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 5.0% annually. So it's pretty clear that, while Richter Gedeon Vegyészeti Gyár Nyilvánosan Muködo Rt's revenue growth is expected to slow, it's still expected to grow faster than the industry itself.

The Bottom Line

The biggest concern is that the analysts reduced their earnings per share estimates, suggesting business headwinds could lay ahead for Richter Gedeon Vegyészeti Gyár Nyilvánosan Muködo Rt. Happily, there were no major changes to revenue forecasts, with the business still expected to grow faster than the wider industry. The consensus price target held steady at Ft9,251, with the latest estimates not enough to have an impact on their price targets.

Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. We have forecasts for Richter Gedeon Vegyészeti Gyár Nyilvánosan Muködo Rt going out to 2025, 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 Richter Gedeon Vegyészeti Gyár Nyilvánosan Muködo Rt you should be aware of.

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This article by Simply Wall St is general in nature. 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.
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