DiaSorin S.p.A. (BIT:DIA) Just Reported Third-Quarter Earnings: Have Analysts Changed Their Mind On The Stock?

By
Simply Wall St
Published
November 15, 2020
BIT:DIA

There's been a notable change in appetite for DiaSorin S.p.A. (BIT:DIA) shares in the week since its third-quarter report, with the stock down 14% to €174. The results were positive, with revenue coming in at €228m, beating analyst expectations by 4.6%. Earnings are an important time for investors, as they can track a company's performance, look at what the analysts are forecasting for next year, and see if there's been a change in sentiment towards the company. With this in mind, we've gathered the latest statutory forecasts to see what the analysts are expecting for next year.

Check out our latest analysis for DiaSorin

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BIT:DIA Earnings and Revenue Growth November 15th 2020

Taking into account the latest results, the most recent consensus for DiaSorin from nine analysts is for revenues of €1.07b in 2021 which, if met, would be a sizeable 36% increase on its sales over the past 12 months. Statutory earnings per share are predicted to leap 45% to €5.61. Yet prior to the latest earnings, the analysts had been anticipated revenues of €1.03b and earnings per share (EPS) of €5.00 in 2021. There's been a pretty noticeable increase in sentiment, with the analysts upgrading revenues and making a nice gain to earnings per share in particular.

Despite these upgrades,the analysts have not made any major changes to their price target of €161, 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. The most optimistic DiaSorin analyst has a price target of €201 per share, while the most pessimistic values it at €101. This is a fairly broad spread of estimates, suggesting that analysts are forecasting a wide range of possible outcomes for the business.

Taking a look at the bigger picture now, one of the ways we can understand these forecasts is to see how they compare to both past performance and industry growth estimates. It's clear from the latest estimates that DiaSorin's rate of growth is expected to accelerate meaningfully, with the forecast 36% revenue growth noticeably faster than its historical growth of 8.4%p.a. over the past five years. Compare this with other companies in the same industry, which are forecast to grow their revenue 8.8% next year. It seems obvious that, while the growth outlook is brighter than the recent past, the analysts also expect DiaSorin to grow faster than the wider industry.

The Bottom Line

The most important thing here is that the analysts upgraded their earnings per share estimates, suggesting that there has been a clear increase in optimism towards DiaSorin following these results. Pleasantly, they also upgraded their revenue estimates, and their forecasts suggest the business is expected to grow faster than the wider industry. The consensus price target held steady at €161, with the latest estimates not enough to have an impact on their price targets.

Following on from that line of thought, we think that the long-term prospects of the business are much more relevant than next year's earnings. We have forecasts for DiaSorin going out to 2024, and you can see them free on our platform here.

You can also see our analysis of DiaSorin's Board and CEO remuneration and experience, and whether company insiders have been buying stock.

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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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