Alfen N.V. (AMS:ALFEN) Half-Year Results: Here's What Analysts Are Forecasting For This Year

It's been a good week for Alfen N.V. (AMS:ALFEN) shareholders, because the company has just released its latest interim results, and the shares gained 6.8% to €16.29. Alfen reported in line with analyst predictions, delivering revenues of €246m and statutory earnings per share of €1.36, suggesting the business is executing well and in line with its plan. 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've gathered the most recent statutory forecasts to see whether the analysts have changed their earnings models, following these results.

See our latest analysis for Alfen

After the latest results, the consensus from Alfen's ten analysts is for revenues of €497.3m in 2024, which would reflect a discernible 5.5% decline in revenue compared to the last year of performance. Earnings are expected to tip over into lossmaking territory, with the analysts forecasting statutory losses of -€0.57 per share in 2024. Before this earnings announcement, the analysts had been modelling revenues of €487.6m and losses of €0.14 per share in 2024. While this year's revenue estimates held steady, there was also a considerable increase to loss per share expectations, suggesting the consensus has a bit of a mixed view on the stock.

As a result, there was no major change to the consensus price target of €22.25, with the analysts implicitly confirming that the business looks to be performing in line with expectations, despite higher forecast losses. The consensus price target is just an average of individual analyst targets, so - it could be handy to see how wide the range of underlying estimates is. Currently, the most bullish analyst values Alfen at €41.00 per share, while the most bearish prices it at €16.00. With such a wide range in price targets, analysts are almost certainly betting on widely divergent outcomes in the underlying business. With this in mind, we wouldn't rely too heavily the consensus price target, as it is just an average and analysts clearly have some deeply divergent views on the business.

Another way we can view these estimates is in the context of the bigger picture, such as how the forecasts stack up against past performance, and whether forecasts are more or less bullish relative to other companies in the industry. These estimates imply that revenue is expected to slow, with a forecast annualised decline of 11% by the end of 2024. This indicates a significant reduction from annual growth of 30% over the last five years. By contrast, our data suggests that other companies (with analyst coverage) in the same industry are forecast to see their revenue grow 7.2% annually for the foreseeable future. So although its revenues are forecast to shrink, this cloud does not come with a silver lining - Alfen is expected to lag the wider industry.

The Bottom Line

The most important thing to take away is that the analysts increased their loss per share estimates for next year. On the plus side, there were no major changes to revenue estimates; although forecasts imply they will perform worse than the wider industry. There was no real change to the consensus price target, suggesting that the intrinsic value of the business has not undergone any major changes with the latest estimates.

With that in mind, we wouldn't be too quick to come to a conclusion on Alfen. Long-term earnings power is much more important than next year's profits. We have forecasts for Alfen going out to 2026, and you can see them free on our platform here.

You should always think about risks though. Case in point, we've spotted 3 warning signs for Alfen you should be aware of, and 1 of them is concerning.

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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.