Growth Investors: Industry Analysts Just Upgraded Their Ciech S.A. (WSE:CIE) Revenue Forecasts By 19%

Shareholders in Ciech S.A. (WSE:CIE) may be thrilled to learn that the analysts have just delivered a major upgrade to their near-term forecasts. The analysts have sharply increased their revenue numbers, with a view that Ciech will make substantially more sales than they'd previously expected.

Following the upgrade, the latest consensus from Ciech's six analysts is for revenues of zł4.5b in 2022, which would reflect a huge 31% improvement in sales compared to the last 12 months. Prior to the latest estimates, the analysts were forecasting revenues of zł3.8b in 2022. It looks like there's been a clear increase in optimism around Ciech, given the nice gain to revenue forecasts.

View our latest analysis for Ciech

The consensus price target rose 7.4% to zł49.25, with the analysts clearly more optimistic about Ciech's prospects following this update. Fixating on a single price target can be unwise though, since the consensus target is effectively the average of analyst price targets. As a result, some investors like to look at the range of estimates to see if there are any diverging opinions on the company's valuation. The most optimistic Ciech analyst has a price target of zł56.70 per share, while the most pessimistic values it at zł33.00. Analysts definitely have varying views on the business, but the spread of estimates is not wide enough in our view to suggest that extreme outcomes could await Ciech shareholders.

Of course, another way to look at these forecasts is to place them into context against the industry itself. For example, we noticed that Ciech's rate of growth is expected to accelerate meaningfully, with revenues forecast to exhibit 31% growth to the end of 2022 on an annualised basis. That is well above its historical decline of 3.1% a year over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in the industry are forecast to see their revenue grow 4.1% per year. So it looks like Ciech is expected to grow faster than its competitors, at least for a while.

The Bottom Line

The highlight for us was that analysts increased their revenue forecasts for Ciech this year. Analysts also expect revenues to grow faster than the wider market. There was also a nice increase in the price target, with analysts apparently feeling that the intrinsic value of the business is improving. Seeing the dramatic upgrade to this year's forecasts, it might be time to take another look at Ciech.

Analysts are definitely bullish on Ciech, but no company is perfect. Indeed, you should know that there are several potential concerns to be aware of, including a weak balance sheet. You can learn more, and discover the 2 other concerns we've identified, for free on our platform here.

You can also see our analysis of Ciech's Board and CEO remuneration and experience, and whether company insiders have been buying stock.

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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.