€3.81 - That's What Analysts Think Marzocchi Pompe S.p.A. (BIT:MARP) Is Worth After These Results

Investors in Marzocchi Pompe S.p.A. (BIT:MARP) had a good week, as its shares rose 9.5% to close at €3.46 following the release of its annual results. Overall the results were a little better than the analysts were expecting, with revenues beating forecasts by 6.8%to hit €35m. Following the result, the analysts have updated their earnings model, and it would be good to know whether they think there's been a strong change in the company's prospects, or if it's business as usual. With this in mind, we've gathered the latest statutory forecasts to see what the analysts are expecting for next year.

Check out our latest analysis for Marzocchi Pompe

Taking into account the latest results, the consensus forecast from Marzocchi Pompe's dual analysts is for revenues of €37.1m in 2021, which would reflect an okay 6.8% improvement in sales compared to the last 12 months. Marzocchi Pompe is also expected to turn profitable, with statutory earnings of €0.01 per share. In the lead-up to this report, the analysts had been modelling revenues of €35.8m and earnings per share (EPS) of €0.05 in 2021. So it's pretty clear the analysts have mixed opinions on Marzocchi Pompe after the latest results; even though they upped their revenue numbers, it came at the cost of a large cut to per-share earnings expectations.

Curiously, the consensus price target rose 19% to €3.81. We can only conclude that the forecast revenue growth is expected to offset the impact of the expected fall in earnings.

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. The analysts are definitely expecting Marzocchi Pompe's growth to accelerate, with the forecast 6.8% annualised growth to the end of 2021 ranking favourably alongside historical growth of 2.6% per annum over the past five years. Compare this with other companies in the same industry, which are forecast to grow their revenue 7.6% annually. Factoring in the forecast acceleration in revenue, it's pretty clear that Marzocchi Pompe is expected 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. There was also an upgrade to revenue estimates, although as we saw earlier, forecast growth is only expected to be about the same as the wider industry. We note an upgrade to the price target, suggesting that the analysts believes the intrinsic value of the business is likely to improve over time.

With that in mind, we wouldn't be too quick to come to a conclusion on Marzocchi Pompe. Long-term earnings power is much more important than next year's profits. We have analyst estimates for Marzocchi Pompe going out as far as 2023, and you can see them free on our platform here.

Plus, you should also learn about the 3 warning signs we've spotted with Marzocchi Pompe .

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