Earnings Update: Piaggio & C. SpA (BIT:PIA) Just Reported Its Full-Year Results And Analysts Are Updating Their Forecasts

Piaggio & C. SpA (BIT:PIA) shareholders are probably feeling a little disappointed, since its shares fell 9.3% to €2.86 in the week after its latest full-year results. Results look mixed - while revenue fell marginally short of analyst estimates at €2.0b, statutory earnings were in line with expectations, at €0.26 per share. This is an important time for investors, as they can track a company's performance in its report, look at what experts are forecasting for next year, and see if there has been any change to expectations for the business. We've gathered the most recent statutory forecasts to see whether the analysts have changed their earnings models, following these results.

See our latest analysis for Piaggio & C

Taking into account the latest results, the current consensus from Piaggio & C's five analysts is for revenues of €2.05b in 2024. This would reflect a reasonable 2.7% increase on its revenue over the past 12 months. Statutory earnings per share are predicted to rise 8.4% to €0.28. In the lead-up to this report, the analysts had been modelling revenues of €2.12b and earnings per share (EPS) of €0.29 in 2024. It's pretty clear that pessimism has reared its head after the latest results, leading to a weaker revenue outlook and a minor downgrade to earnings per share estimates.

Despite the cuts to forecast earnings, there was no real change to the €3.87 price target, showing that the analysts don't think the changes have a meaningful impact on its intrinsic value. 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. There are some variant perceptions on Piaggio & C, with the most bullish analyst valuing it at €5.00 and the most bearish at €3.00 per share. 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 Piaggio & C 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 pretty clear that there is an expectation that Piaggio & C's revenue growth will slow down substantially, with revenues to the end of 2024 expected to display 2.7% growth on an annualised basis. This is compared to a historical growth rate of 10% over the past five years. Juxtapose this against the other companies in the industry with analyst coverage, which are forecast to grow their revenues (in aggregate) 2.7% annually. Factoring in the forecast slowdown in growth, it looks like Piaggio & C is forecast to grow at about the same rate as the wider industry.

The Bottom Line

The most important thing to take away is that the analysts downgraded their earnings per share estimates, showing that there has been a clear decline in sentiment following these results. They also downgraded their revenue estimates, although as we saw earlier, forecast growth is only expected to be about the same as the wider industry. The consensus price target held steady at €3.87, with the latest estimates not enough to have an impact on their price targets.

With that in mind, we wouldn't be too quick to come to a conclusion on Piaggio & C. Long-term earnings power is much more important than next year's profits. We have forecasts for Piaggio & C going out to 2026, and you can see them free on our platform here.

We don't want to rain on the parade too much, but we did also find 2 warning signs for Piaggio & C that you need to be mindful 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.