News Flash: One Analyst Just Made A Sizeable Upgrade To Their Melhus Sparebank (OB:MELG) Forecasts

Melhus Sparebank (OB:MELG) shareholders will have a reason to smile today, with the covering analyst making substantial upgrades to this year's forecasts. The consensus estimated revenue numbers rose, with their view now clearly much more bullish on the company's business prospects.

Following the latest upgrade, the one analyst covering Melhus Sparebank provided consensus estimates of kr233m revenue in 2022, which would reflect a measurable 3.7% decline on its sales over the past 12 months. Statutory earnings per share are expected to be kr13.95, roughly flat on the last 12 months. Before this latest update, the analyst had been forecasting revenues of kr182m and earnings per share (EPS) of kr14.09 in 2022. It seems analyst sentiment has certainly become more bullish on revenues, even though they haven't changed their view on earnings per share.

See our latest analysis for Melhus Sparebank

It may not be a surprise to see that the analyst has reconfirmed their price target of kr185, implying that the uplift in sales is not expected to greatly contribute to Melhus Sparebank's valuation in the near term.

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. We would also point out that the forecast 3.7% annualised revenue decline to the end of 2022 is better than the historical trend, which saw revenues shrink 6.6% annually 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 grow 10% per year. So while a broad number of companies are forecast to grow, unfortunately Melhus Sparebank is expected to see its sales affected worse than other companies in the industry.

The Bottom Line

The most obvious conclusion from this consensus update is that there's been no major change in the business' prospects in recent times, with the analyst holding earnings per share steady, in line with previous estimates. Fortunately, they also upgraded their revenue estimates, and are forecasting revenues to grow slower than the wider market. Seeing the dramatic upgrade to this year's forecasts, it might be time to take another look at Melhus Sparebank.

Still, the long-term prospects of the business are much more relevant than next year's earnings. At least one analyst has provided forecasts out to 2024, which can be seen for free on our platform here.

Of course, seeing company management invest large sums of money in a stock can be just as useful as knowing whether analysts are upgrading their estimates. So you may also wish to search this free list of stocks that insiders are buying.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

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.