Piaggio & C. SpA Just Missed EPS By 18%: Here's What Analysts Think Will Happen Next

Piaggio & C. SpA (BIT:PIA) shareholders are probably feeling a little disappointed, since its shares fell 5.1% to €2.55 in the week after its latest half-yearly results. It was not a great result overall. While revenues of €990m were in line with analyst predictions, earnings were less than expected, missing statutory estimates by 18% to hit €0.15 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've gathered the most recent statutory forecasts to see whether the analysts have changed their earnings models, following these results.

View our latest analysis for Piaggio & C

Taking into account the latest results, the most recent consensus for Piaggio & C from five analysts is for revenues of €1.87b in 2024. If met, it would imply a satisfactory 2.6% increase on its revenue over the past 12 months. Statutory earnings per share are predicted to rise 6.2% to €0.23. In the lead-up to this report, the analysts had been modelling revenues of €1.91b and earnings per share (EPS) of €0.27 in 2024. The analysts seem less optimistic after the recent results, reducing their revenue forecasts and making a real cut to earnings per share numbers.

It'll come as no surprise then, to learn that the analysts have cut their price target 6.7% to €3.48. The consensus price target is just an average of individual analyst targets, so - it could be handy to see how wide the range of underlying estimates is. There are some variant perceptions on Piaggio & C, with the most bullish analyst valuing it at €5.00 and the most bearish at €2.80 per share. This is a fairly broad spread of estimates, suggesting that analysts are forecasting a wide range of possible outcomes for the business.

Another way we can view these estimates is in the context of the bigger picture, such as how the forecasts stack up against past performance, and whether forecasts are more or less bullish relative to other companies in the industry. We would highlight that Piaggio & C's revenue growth is expected to slow, with the forecast 5.3% annualised growth rate until the end of 2024 being well below the historical 9.1% 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 3.0% annually. Even after the forecast slowdown in growth, it seems obvious that Piaggio & C is also expected to grow faster than 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 Piaggio & C's revenue estimates, but industry data suggests that it is expected to grow faster than the wider industry. Furthermore, the analysts also cut their price targets, suggesting that the latest news has led to greater pessimism about the intrinsic value of the business.

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 forecasts for Piaggio & C going out to 2026, and you can see them free on our platform here.

However, before you get too enthused, we've discovered 2 warning signs for Piaggio & C that 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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com