Rainbows and Unicorns: The Archicom S.A. (WSE:ARH) Analyst Just Became A Lot More Optimistic

Archicom S.A. (WSE:ARH) shareholders will have a reason to smile today, with the covering analyst making substantial upgrades to this year's forecasts. The analyst greatly increased their revenue estimates, suggesting a stark improvement in business fundamentals.

After this upgrade, Archicom's solitary analyst is now forecasting revenues of zł867m in 2023. This would be a substantial 100% improvement in sales compared to the last 12 months. Per-share earnings are expected to surge 66% to zł5.16. Prior to this update, the analyst had been forecasting revenues of zł487m and earnings per share (EPS) of zł2.40 in 2023. So we can see there's been a pretty clear increase in analyst sentiment in recent times, with both revenues and earnings per share receiving a decent lift in the latest estimates.

Check out our latest analysis for Archicom

With these upgrades, we're not surprised to see that the analyst has lifted their price target 89% to zł32.44 per share.

Of course, another way to look at these forecasts is to place them into context against the industry itself. It's clear from the latest estimates that Archicom's rate of growth is expected to accelerate meaningfully, with the forecast 152% annualised revenue growth to the end of 2023 noticeably faster than its historical growth of 6.2% p.a. 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 6.5% per year. Factoring in the forecast acceleration in revenue, it's pretty clear that Archicom is expected to grow much faster than its industry.

The Bottom Line

The biggest takeaway for us from these new estimates is that the analyst upgraded their earnings per share estimates, with improved earnings power expected for this year. Fortunately, the analyst also upgraded their revenue estimates, and our data indicates sales are expected to perform better than the wider market. With a serious upgrade to expectations and a rising price target, it might be time to take another look at Archicom.

Even so, the longer term trajectory of the business is much more important for the value creation of shareholders. At least one analyst has provided forecasts out to 2025, 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.