Sligro Food Group N.V. Beat Revenue Forecasts By 8.7%: Here's What Analysts Are Forecasting Next

Sligro Food Group N.V. (AMS:SLIGR) last week reported its latest half-year 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 a workmanlike result, with revenues of €1.1b coming in 8.7% ahead of expectations, and statutory earnings per share of €0.45, 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. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether the analysts have changed their mind on Sligro Food Group after the latest results.

Check out our latest analysis for Sligro Food Group

Taking into account the latest results, the current consensus from Sligro Food Group's three analysts is for revenues of €2.42b in 2022, which would reflect a notable 8.1% increase on its sales over the past 12 months. Per-share earnings are expected to shoot up 23% to €1.31. In the lead-up to this report, the analysts had been modelling revenues of €2.43b and earnings per share (EPS) of €0.94 in 2022. There was no real change to the revenue estimates, but the analysts do seem more bullish on earnings, given the very substantial lift in earnings per share expectations following these results.

The consensus price target was unchanged at €24.33, implying that the improved earnings outlook is not expected to have a long term impact on value creation for shareholders. There's another way to think about price targets though, and that's to look at the range of price targets put forward by analysts, because a wide range of estimates could suggest a diverse view on possible outcomes for the business. Currently, the most bullish analyst values Sligro Food Group at €25.00 per share, while the most bearish prices it at €24.00. This is a very narrow spread of estimates, implying either that Sligro Food Group is an easy company to value, or - more likely - the analysts are relying heavily on some key assumptions.

Looking at the bigger picture now, one of the ways we can make sense of these forecasts is to see how they measure up against both past performance and industry growth estimates. One thing stands out from these estimates, which is that Sligro Food Group is forecast to grow faster in the future than it has in the past, with revenues expected to display 17% annualised growth until the end of 2022. If achieved, this would be a much better result than the 3.3% 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 5.7% annually. Not only are Sligro Food Group's revenues expected to improve, it seems that the analysts are also expecting it 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 Sligro Food Group following these results. Fortunately, they also reconfirmed their revenue numbers, suggesting sales are tracking in line with expectations - and our data suggests that revenues are expected to grow faster 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.

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 Sligro Food Group going out to 2024, and you can see them free on our platform here.

Plus, you should also learn about the 2 warning signs we've spotted with Sligro Food Group .

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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.