Earnings Update: Ariston Holding N.V. (BIT:ARIS) Just Reported Its Half-Yearly Results And Analysts Are Updating Their Forecasts

It's been a good week for Ariston Holding N.V. (BIT:ARIS) shareholders, because the company has just released its latest interim results, and the shares gained 2.4% to €8.71. The results were positive, with revenue coming in at €582m, beating analyst expectations by 4.8%. 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.

See our latest analysis for Ariston Holding

After the latest results, the five analysts covering Ariston Holding are now predicting revenues of €2.35b in 2022. If met, this would reflect a modest 4.5% improvement in sales compared to the last 12 months. Statutory earnings per share are predicted to surge 23% to €0.45. In the lead-up to this report, the analysts had been modelling revenues of €2.35b and earnings per share (EPS) of €0.47 in 2022. The analysts seem to have become a little more negative on the business after the latest results, given the small dip in their earnings per share numbers for next year.

It might be a surprise to learn that the consensus price target was broadly unchanged at €11.13, with the analysts clearly implying that the forecast decline in earnings is not expected to have much of an impact on valuation. 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. Currently, the most bullish analyst values Ariston Holding at €13.00 per share, while the most bearish prices it at €8.25. 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 Ariston Holding shareholders.

Of course, another way to look at these forecasts is to place them into context against the industry itself. It's pretty clear that there is an expectation that Ariston Holding's revenue growth will slow down substantially, with revenues to the end of 2022 expected to display 9.2% growth on an annualised basis. This is compared to a historical growth rate of 21% over the past year. Juxtapose this against the other companies in the industry with analyst coverage, which are forecast to grow their revenues (in aggregate) 3.8% per year. Even after the forecast slowdown in growth, it seems obvious that Ariston Holding 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. Happily, there were no major changes to revenue forecasts, with the business still expected to grow faster than the wider industry. The consensus price target held steady at €11.13, 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 Ariston Holding. Long-term earnings power is much more important than next year's profits. We have forecasts for Ariston Holding going out to 2024, and you can see them free on our platform here.

Don't forget that there may still be risks. For instance, we've identified 1 warning sign for Ariston Holding that you should be aware of.

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

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.