This Just In: Analysts Are Boosting Their De'Longhi S.p.A. (BIT:DLG) Outlook for Next Year

De'Longhi S.p.A. (BIT:DLG) shareholders will have a reason to smile today, with the analysts making substantial upgrades to next year's forecasts. The consensus statutory numbers for both revenue and earnings per share (EPS) increased, with their view clearly much more bullish on the company's business prospects.

Following the upgrade, the latest consensus from De'Longhi's five analysts is for revenues of €2.6b in 2021, which would reflect a decent 16% improvement in sales compared to the last 12 months. Statutory earnings per share are presumed to grow 19% to €1.53. Prior to this update, the analysts had been forecasting revenues of €2.3b and earnings per share (EPS) of €1.28 in 2021. So we can see there's been a pretty clear increase in analyst sentiment in recent times, with both revenues and earnings per share receiving a decent lift in the latest estimates.

See our latest analysis for De'Longhi

Despite these upgrades, the analysts have not made any major changes to their price target of €31.88, suggesting that the higher estimates are not likely to have a long term impact on what the stock is worth. That's not the only conclusion we can draw from this data however, as some investors also like to consider the spread in estimates when evaluating analyst price targets. There are some variant perceptions on De'Longhi, with the most bullish analyst valuing it at €38.00 and the most bearish at €16.50 per share. This is a fairly broad spread of estimates, suggesting that the analysts are forecasting a wide range of possible outcomes for the business.

One way to get more context on these forecasts is to look at how they compare to both past performance, and how other companies in the same industry are performing. It's clear from the latest estimates that De'Longhi's rate of growth is expected to accelerate meaningfully, with the forecast 16% revenue growth noticeably faster than its historical growth of 3.7% p.a. over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in the same industry are forecast to see their revenue shrink 15% per year. It seems obvious that as part of the brighter growth outlook, De'Longhi is expected 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 next year. On the plus side, they also lifted their revenue estimates, and the company is expected to perform better than the wider market. The lack of change in the price target is puzzling, but with a serious upgrade to next year's earnings expectations, it might be time to take another look at De'Longhi.

Even so, the longer term trajectory of the business is much more important for the value creation of shareholders. At Simply Wall St, we have a full range of analyst estimates for De'Longhi going out to 2024, and you can see them free on our platform here..

Another thing to consider is whether management and directors have been buying or selling stock recently. We provide an overview of all open market stock trades for the last twelve months on our platform, here.

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This article by Simply Wall St is general in nature. 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.
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