Alkemy S.p.A. (BIT:ALK) Analysts Are Pretty Bullish On The Stock After Recent Results

It's been a pretty great week for Alkemy S.p.A. (BIT:ALK) shareholders, with its shares surging 11% to €10.50 in the week since its latest full-year results. It was an okay report, and revenues came in at €74m, approximately in line with analyst estimates leading up to the results announcement. 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. So we collected the latest post-earnings statutory consensus estimates to see what could be in store for next year.

Check out our latest analysis for Alkemy

Taking into account the latest results, the most recent consensus for Alkemy from two analysts is for revenues of €85.0m in 2021 which, if met, would be a notable 15% increase on its sales over the past 12 months. Alkemy is also expected to turn profitable, with statutory earnings of €0.56 per share. Before this earnings report, the analysts had been forecasting revenues of €82.5m and earnings per share (EPS) of €0.53 in 2021. It looks like there's been a modest increase in sentiment following the latest results, withthe analysts becoming a bit more optimistic in their predictions for both revenues and earnings.

With these upgrades, we're not surprised to see that the analysts have lifted their price target 19% to €11.30per share.

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. We would highlight that Alkemy's revenue growth is expected to slow, with the forecast 15% annualised growth rate until the end of 2021 being well below the historical 22% p.a. growth over the last five years. Juxtapose this against the other companies in the industry with analyst coverage, which are forecast to grow their revenues (in aggregate) 5.9% per year. So it's pretty clear that, while Alkemy's revenue growth is expected to slow, it's still expected to grow faster than the industry itself.

The Bottom Line

The most important thing here is that the analysts upgraded their earnings per share estimates, suggesting that there has been a clear increase in optimism towards Alkemy following these results. Happily, they also upgraded their revenue estimates, and are forecasting revenues to grow faster than the wider industry. There was also a nice increase in the price target, with the analysts clearly feeling that the intrinsic value of the business is improving.

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 analyst estimates for Alkemy going out as far as 2023, 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 3 warning signs for Alkemy that you need to be mindful of.

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