Endúr ASA (OB:ENDUR) Just Reported, And Analysts Assigned A kr1.35 Price Target

It's been a mediocre week for Endúr ASA (OB:ENDUR) shareholders, with the stock dropping 18% to kr1.16 in the week since its latest quarterly results. Revenues came in at kr76m, an impressive 22% ahead of analyst forecasts. The analyst 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 analyst has changed their mind on Endúr after the latest results.

View our latest analysis for Endúr

After the latest results, the sole analyst covering Endúr are now predicting revenues of kr1.23b in 2021. If met, this would reflect a huge 161% improvement in sales compared to the last 12 months. Earnings are expected to improve, with Endúr forecast to report a statutory profit of kr0.05 per share. Yet prior to the latest earnings, the analyst had been anticipated revenues of kr1.29b and earnings per share (EPS) of kr0.07 in 2021. From this we can that sentiment has definitely become more bearish after the latest results, leading to lower revenue forecasts and a large cut to earnings per share estimates.

It'll come as no surprise then, to learn that the analyst has cut their price target 23% to kr1.35.

One way to get more context on these forecasts is to look at how they compare to both past performance, and how other companies in the same industry are performing. The analyst is definitely expecting Endúr's growth to accelerate, with the forecast 161% growth ranking favourably alongside historical growth of 11% per annum over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to grow their revenue at 5.8% per year. Factoring in the forecast acceleration in revenue, it's pretty clear that Endúr is expected to grow much faster than its industry.

The Bottom Line

The biggest concern is that the analyst reduced their earnings per share estimates, suggesting business headwinds could lay ahead for Endúr. They also downgraded their revenue estimates, although industry data suggests that Endúr's revenues are expected to grow faster than the wider industry. Furthermore, the analyst also cut their price targets, suggesting that the latest news has led to greater pessimism about the intrinsic value of the business.

With that in mind, we wouldn't be too quick to come to a conclusion on Endúr. Long-term earnings power is much more important than next year's profits. At least one analyst has provided forecasts out to 2023, which can be seen for free on our platform here.

Don't forget that there may still be risks. For instance, we've identified 3 warning signs for Endúr (1 is a bit unpleasant) you should be aware of.

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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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