Analyst Forecasts For Webuild S.p.A. (BIT:WBD) Are Surging Higher

Webuild S.p.A. (BIT:WBD) shareholders will have a reason to smile today, with the analysts making substantial upgrades to this year's forecasts. The analysts greatly increased their revenue estimates, suggesting a stark improvement in business fundamentals. Webuild has also found favour with investors, with the stock up a remarkable 15% to €1.90 over the past week. Could this upgrade be enough to drive the stock even higher?

Following the upgrade, the most recent consensus for Webuild from its three analysts is for revenues of €8.7b in 2023 which, if met, would be a solid 14% increase on its sales over the past 12 months. Per-share earnings are expected to bounce 362% to €0.13. Prior to this update, the analysts had been forecasting revenues of €7.8b and earnings per share (EPS) of €0.10 in 2023. There has definitely been an improvement in perception recently, with the analysts substantially increasing both their earnings and revenue estimates.

View our latest analysis for Webuild

With these upgrades, we're not surprised to see that the analysts have lifted their price target 9.8% to €2.25 per share. 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. The most optimistic Webuild analyst has a price target of €2.40 per share, while the most pessimistic values it at €2.10. With such a narrow range of valuations, analysts apparently share similar views on what they think the business is worth.

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. The analysts are definitely expecting Webuild's growth to accelerate, with the forecast 14% annualised growth to the end of 2023 ranking favourably alongside historical growth of 7.6% per annum over the past five years. Compare this with other companies in the same industry, which are forecast to grow their revenue 9.5% annually. It seems obvious that, while the growth outlook is brighter than the recent past, the analysts also expect Webuild to grow faster than the wider industry.

The Bottom Line

The biggest takeaway for us from these new estimates is that analysts upgraded their earnings per share estimates, with improved earnings power expected for this year. Fortunately, analysts also upgraded their revenue estimates, and our data indicates sales are expected to perform better than the wider market. With a serious upgrade to expectations and a rising price target, it might be time to take another look at Webuild.

Using these estimates as a starting point, we've run a discounted cash flow calculation (DCF) on Webuild that suggests the company could be somewhat undervalued. For more information, you can click through to our platform to learn more about our valuation approach.

Another way to search for interesting companies that could be reaching an inflection point is to track whether management are buying or selling, with our free list of growing companies that insiders are buying.

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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.