Wallenius Wilhelmsen ASA Just Missed Earnings - But Analysts Have Updated Their Models

Wallenius Wilhelmsen ASA (OB:WAWI) missed earnings with its latest quarterly results, disappointing overly-optimistic forecasters. Wallenius Wilhelmsen missed earnings this time around, with US$1.3b revenue coming in 3.4% below what the analysts had modelled. Statutory earnings per share (EPS) of US$0.39 also fell short of expectations by 18%. This is an important time for investors, as they can track a company's performance in its report, look at what experts are forecasting for next year, and see if there has been any change to expectations for the business. We've gathered the most recent statutory forecasts to see whether the analysts have changed their earnings models, following these results.

Check out our latest analysis for Wallenius Wilhelmsen

Taking into account the latest results, the consensus forecast from Wallenius Wilhelmsen's four analysts is for revenues of US$5.30b in 2024. This reflects a credible 2.9% improvement in revenue compared to the last 12 months. Statutory earnings per share are predicted to expand 15% to US$2.35. Yet prior to the latest earnings, the analysts had been anticipated revenues of US$5.43b and earnings per share (EPS) of US$2.54 in 2024. It's pretty clear that pessimism has reared its head after the latest results, leading to a weaker revenue outlook and a small dip in earnings per share estimates.

The analysts made no major changes to their price target of kr147, suggesting the downgrades are not expected to have a long-term impact on Wallenius Wilhelmsen's valuation. 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 Wallenius Wilhelmsen at kr159 per share, while the most bearish prices it at kr136. We would probably assign less value to the analyst forecasts in this situation, because such a wide range of estimates could imply that the future of this business is difficult to value accurately. As a result it might not be a great idea to make decisions based on the consensus price target, which is after all just an average of this wide range of estimates.

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. It's pretty clear that there is an expectation that Wallenius Wilhelmsen's revenue growth will slow down substantially, with revenues to the end of 2024 expected to display 3.9% growth on an annualised basis. This is compared to a historical growth rate of 8.8% over the past five years. Juxtapose this against the other companies in the industry with analyst coverage, which are forecast to grow their revenues (in aggregate) 0.8% per year. So it's pretty clear that, while Wallenius Wilhelmsen's revenue growth is expected to slow, it's still expected to grow faster than the industry itself.

The Bottom Line

The most important thing to take away is that the analysts downgraded their earnings per share estimates, showing that there has been a clear decline in sentiment following these results. They also downgraded Wallenius Wilhelmsen's revenue estimates, but industry data suggests that it is 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.

With that said, the long-term trajectory of the company's earnings is a lot more important than next year. We have forecasts for Wallenius Wilhelmsen going out to 2026, and you can see them free on our platform here.

It is also worth noting that we have found 1 warning sign for Wallenius Wilhelmsen that you need to take into consideration.

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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.