Cerved Group S.p.A. (BIT:CERV) shareholders are probably feeling a little disappointed, since its shares fell 4.0% to €6.05 in the week after its latest third-quarter results. It was a workmanlike result, with revenues of €112m coming in 3.7% ahead of expectations, and statutory earnings per share of €0.28, in line with analyst appraisals. The analysts typically update their forecasts at each earnings report, and we can judge from their estimates whether their view of the company has changed or if there are any new concerns to be aware of. So we gathered the latest post-earnings forecasts to see what estimates suggest is in store for next year.
Taking into account the latest results, the most recent consensus for Cerved Group from six analysts is for revenues of €521.6m in 2021 which, if met, would be an okay 2.3% increase on its sales over the past 12 months. Statutory earnings per share are predicted to soar 59% to €0.38. Before this earnings report, the analysts had been forecasting revenues of €522.2m and earnings per share (EPS) of €0.38 in 2021. The consensus analysts don't seem to have seen anything in these results that would have changed their view on the business, given there's been no major change to their estimates.
There were no changes to revenue or earnings estimates or the price target of €8.77, suggesting that the company has met expectations in its recent result. 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 Cerved Group at €10.00 per share, while the most bearish prices it at €7.50. Still, with such a tight range of estimates, it suggeststhe analysts have a pretty good idea of what they think the company is worth.
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 Cerved Group's revenue growth will slow down substantially, with revenues next year expected to grow 2.3%, compared to a historical growth rate of 8.3% over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to see their revenue shrink 56% per year. So it's clear that despite the slowdown in growth, Cerved Group is still expected to grow meaningfully faster than the wider industry.
The Bottom Line
The most important thing to take away is that there's been no major change in sentiment, with the analysts reconfirming that the business is performing in line with their previous earnings per share estimates. Fortunately, they also reconfirmed their revenue estimates, suggesting sales are tracking in line with expectations. Their estimates also suggest that Cerved Group's revenues are expected to perform better than the wider industry. The consensus price target held steady at €8.77, 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 Cerved Group. Long-term earnings power is much more important than next year's profits. At Simply Wall St, we have a full range of analyst estimates for Cerved Group going out to 2024, and you can see them free on our platform here..
You still need to take note of risks, for example - Cerved Group has 4 warning signs we think you should be aware of.
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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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