€8.53: That's What Analysts Think Salvatore Ferragamo S.p.A. (BIT:SFER) Is Worth After Its Latest Results

Salvatore Ferragamo S.p.A. (BIT:SFER) last week reported its latest half-yearly results, which makes it a good time for investors to dive in and see if the business is performing in line with expectations. It was an okay report, and revenues came in at €523m, approximately in line with analyst estimates leading up to the results announcement. This is an important time for investors, as they can track a company's performance in its report, look at what experts are forecasting for next year, and see if there has been any change to expectations for the business. So we collected the latest post-earnings statutory consensus estimates to see what could be in store for next year.

View our latest analysis for Salvatore Ferragamo

Following last week's earnings report, Salvatore Ferragamo's 14 analysts are forecasting 2024 revenues to be €1.07b, approximately in line with the last 12 months. Statutory earnings per share are predicted to shoot up 37% to €0.077. In the lead-up to this report, the analysts had been modelling revenues of €1.08b and earnings per share (EPS) of €0.11 in 2024. The analysts seem to have become more bearish following the latest results. While there were no changes to revenue forecasts, there was a pretty serious reduction to EPS estimates.

The average price target fell 5.3% to €8.53, with reduced earnings forecasts clearly tied to a lower valuation estimate. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. Currently, the most bullish analyst values Salvatore Ferragamo at €10.00 per share, while the most bearish prices it at €7.00. This shows there is still a bit of diversity in estimates, but analysts don't appear to be totally split on the stock as though it might be a success or failure situation.

Of course, another way to look at these forecasts is to place them into context against the industry itself. Over the past five years, revenues have declined around 0.8% annually. Worse, forecasts are essentially predicting the decline to accelerate, with the estimate for an annualised 1.4% decline in revenue until the end of 2024. Compare this against analyst estimates for companies in the broader industry, which suggest that revenues (in aggregate) are expected to grow 8.7% annually. So it's pretty clear that, while it does have declining revenues, the analysts also expect Salvatore Ferragamo to suffer worse than the wider industry.

The Bottom Line

The biggest concern is that the analysts reduced their earnings per share estimates, suggesting business headwinds could lay ahead for Salvatore Ferragamo. On the plus side, there were no major changes to revenue estimates; although forecasts imply they will perform worse than the wider industry. Furthermore, the analysts also cut their price targets, suggesting that the latest news has led to greater pessimism about the intrinsic value of the business.

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 estimates - from multiple Salvatore Ferragamo analysts - going out to 2026, and you can see them free on our platform here.

And what about risks? Every company has them, and we've spotted 3 warning signs for Salvatore Ferragamo you should know about.

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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.

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