Analysts' Revenue Estimates For Wereldhave N.V. (AMS:WHA) Are Surging Higher

Celebrations may be in order for Wereldhave N.V. (AMS:WHA) shareholders, with the analysts delivering a significant upgrade to their statutory estimates for the company. The consensus estimated revenue numbers rose, with their view now clearly much more bullish on the company's business prospects. Investor sentiment seems to be improving too, with the share price up 6.6% to €12.62 over the past 7 days. It will be interesting to see if this latest upgrade is enough to kickstart further buying interest in the stock.

Following the latest upgrade, the four analysts covering Wereldhave provided consensus estimates of €197m revenue in 2021, which would reflect a definite 11% decline on its sales over the past 12 months. Prior to the latest estimates, the analysts were forecasting revenues of €167m in 2021. The consensus has definitely become more optimistic, showing a nice increase in revenue forecasts.

See our latest analysis for Wereldhave

The consensus price target rose 6.6% to €10.60, with the analysts clearly more optimistic about Wereldhave's prospects following this update. Fixating on a single price target can be unwise though, since the consensus target is effectively the average of analyst price targets. As a result, some investors like to look at the range of estimates to see if there are any diverging opinions on the company's valuation. There are some variant perceptions on Wereldhave, with the most bullish analyst valuing it at €20.00 and the most bearish at €7.22 per share. As you can see the range of estimates is wide, with the lowest valuation coming in at less than half the most bullish estimate, suggesting there are some strongly diverging views on how think this business will perform. As a result it might not be possible to derive much meaning from the consensus price target, which is after all just an average of this wide range of estimates.

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. Over the past five years, revenues have declined around 2.9% annually. Worse, forecasts are essentially predicting the decline to accelerate, with the estimate for a 11% decline in revenue next year. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to see their revenue grow 7.4% per year. So while a broad number of companies are forecast to grow, unfortunately Wereldhave is expected to see its sales affected worse than other companies in the industry.

The Bottom Line

The most important thing to take away from this upgrade is that analysts lifted their revenue estimates for this year. They're also anticipating slower revenue growth than the wider market. There was also an increase in the price target, suggesting that there is more optimism baked into the forecasts than there was previously. Given that analysts appear to be expecting substantial improvement in the sales pipeline, now could be the right time to take another look at Wereldhave.

It's great to see the analysts upgrading their estimates, but the biggest highlight to us is that the business is expected to become profitable in the foreseeable future. You can learn more about these forecasts, for free on our platform here.

Another way to search for interesting companies that could be reaching an inflection point is to track whether management are buying or selling, with our free list of growing companies that insiders are buying.

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