Analyst Estimates: Here's What Brokers Think Of Safilo Group S.p.A. (BIT:SFL) After Its Annual Report

It's been a good week for Safilo Group S.p.A. (BIT:SFL) shareholders, because the company has just released its latest yearly results, and the shares gained 5.2% to €0.96. The results look positive overall; while revenues of €780m were in line with analyst predictions, statutory losses were 6.5% smaller than expected, with Safilo Group losing €0.25 per share. 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. We thought readers would find it interesting to see the analysts latest (statutory) post-earnings forecasts for next year.

View our latest analysis for Safilo Group

Taking into account the latest results, the most recent consensus for Safilo Group from three analysts is for revenues of €802.3m in 2021 which, if met, would be a modest 2.8% increase on its sales over the past 12 months. Losses are predicted to fall substantially, shrinking 88% to €0.03. Before this latest report, the consensus had been expecting revenues of €800.2m and €0.11 per share in losses. Although the revenue estimates have not really changed Safilo Group'sfuture looks a little different to the past, with a very promising decrease in the loss per share forecasts in particular.

The average price target held steady at €0.88, seeming to indicate that business is performing in line with expectations. 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. Currently, the most bullish analyst values Safilo Group at €1.20 per share, while the most bearish prices it at €0.65. This is a fairly broad spread of estimates, suggesting that analysts are forecasting a wide range of possible outcomes for the business.

Of course, another way to look at these forecasts is to place them into context against the industry itself. One thing stands out from these estimates, which is that Safilo Group is forecast to grow faster in the future than it has in the past, with revenues expected to display 2.8% annualised growth until the end of 2021. If achieved, this would be a much better result than the 11% annual decline over the past five years. Compare this against analyst estimates for the broader industry, which suggest that (in aggregate) industry revenues are expected to grow 12% annually for the foreseeable future. So although Safilo Group's revenue growth is expected to improve, it is still expected to grow slower than the industry.

The Bottom Line

The most important thing to take away is that the analysts reconfirmed their loss per share estimates for next year. On the plus side, there were no major changes to revenue estimates; although forecasts imply revenues will perform worse than the wider industry. The consensus price target held steady at €0.88, with the latest estimates not enough to have an impact on their price targets.

With that said, the long-term trajectory of the company's earnings is a lot more important than next year. We have estimates - from multiple Safilo Group analysts - going out to 2022, and you can see them free on our platform here.

You can also view our analysis of Safilo Group's balance sheet, and whether we think Safilo Group is carrying too much debt, for free on our platform here.

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