Results: Rana Gruber ASA Exceeded Expectations And The Consensus Has Updated Its Estimates

A week ago, Rana Gruber ASA (OB:RANA) came out with a strong set of full-year numbers that could potentially lead to a re-rate of the stock. It was overall a positive result, with revenues beating expectations by 2.8% to hit kr1.9b. Rana Gruber reported statutory earnings per share (EPS) kr13.21, which was a notable 13% above what the analysts had forecast. 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. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether the analysts have changed their mind on Rana Gruber after the latest results.

View our latest analysis for Rana Gruber

Taking into account the latest results, the current consensus, from the two analysts covering Rana Gruber, is for revenues of kr1.69b in 2024. This implies a definite 13% reduction in Rana Gruber's revenue over the past 12 months. Statutory earnings per share are forecast to reduce 6.7% to kr12.32 in the same period. Yet prior to the latest earnings, the analysts had been anticipated revenues of kr1.70b and earnings per share (EPS) of kr12.72 in 2024. So it looks like there's been a small decline in overall sentiment after the recent results - there's been no major change to revenue estimates, but the analysts did make a small dip in their earnings per share forecasts.

It might be a surprise to learn that the consensus price target was broadly unchanged at kr90.00, with the analysts clearly implying that the forecast decline in earnings is not expected to have much of an impact on valuation.

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 highlight that revenue is expected to reverse, with a forecast 13% annualised decline to the end of 2024. That is a notable change from historical growth of 7.4% over the last five years. Compare this with our data, which suggests that other companies in the same industry are, in aggregate, expected to see their revenue grow 0.2% per year. So although its revenues are forecast to shrink, this cloud does not come with a silver lining - Rana Gruber is expected to lag the wider industry.

The Bottom Line

The biggest concern is that the analysts reduced their earnings per share estimates, suggesting business headwinds could lay ahead for Rana Gruber. Fortunately, the analysts also reconfirmed their revenue estimates, suggesting that it's tracking in line with expectations. Although our data does suggest that Rana Gruber's revenue is expected to perform worse than the wider industry. The consensus price target held steady at kr90.00, with the latest estimates not enough to have an impact on their price targets.

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. At least one analyst has provided forecasts out to 2026, which can be seen for free on our platform here.

Before you take the next step you should know about the 2 warning signs for Rana Gruber (1 is potentially serious!) that we have uncovered.

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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.