zł81.21 - That's What Analysts Think Wirtualna Polska Holding S.A. (WSE:WPL) Is Worth After These Results

It's been a good week for Wirtualna Polska Holding S.A. (WSE:WPL) shareholders, because the company has just released its latest third-quarter results, and the shares gained 4.1% to zł81.00. It was a workmanlike result, with revenues of zł153m coming in 2.8% ahead of expectations, and statutory earnings per share of zł2.37, in line with analyst appraisals. The analysts 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. We thought readers would find it interesting to see the analysts latest (statutory) post-earnings forecasts for next year.

See our latest analysis for Wirtualna Polska Holding

Taking into account the latest results, the most recent consensus for Wirtualna Polska Holding from four analysts is for revenues of zł777.6m in 2021 which, if met, would be a substantial 29% increase on its sales over the past 12 months. Statutory earnings per share are predicted to soar 62% to zł3.66. Before this earnings report, the analysts had been forecasting revenues of zł775.9m and earnings per share (EPS) of zł3.57 in 2021. The analysts seems to have become more bullish on the business, judging by their new earnings per share estimates.

The consensus price target rose 6.1% to zł81.21, suggesting that higher earnings estimates flow through to the stock's valuation as well. That's not the only conclusion we can draw from this data however, as some investors also like to consider the spread in estimates when evaluating analyst price targets. The most optimistic Wirtualna Polska Holding analyst has a price target of zł95.00 per share, while the most pessimistic values it at zł63.10. This shows there is still a bit of diversity in estimates, but analysts don't appear to be totally split on the stock as though it might be a success or failure situation.

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 clear from the latest estimates that Wirtualna Polska Holding's rate of growth is expected to accelerate meaningfully, with the forecast 29% revenue growth noticeably faster than its historical growth of 16%p.a. over the past five years. Compare this with other companies in the same industry, which are forecast to grow their revenue 19% next year. Factoring in the forecast acceleration in revenue, it's pretty clear that Wirtualna Polska Holding is expected to grow much faster than its industry.

The Bottom Line

The most important thing here is that the analysts upgraded their earnings per share estimates, suggesting that there has been a clear increase in optimism towards Wirtualna Polska Holding following these results. Happily, there were no major changes to revenue forecasts, with the business still expected to grow faster than the wider industry. We note an upgrade to the price target, suggesting that the analysts believes the intrinsic value of the business is likely to improve over time.

With that said, the long-term trajectory of the company's earnings is a lot more important than next year. We have estimates - from multiple Wirtualna Polska Holding analysts - going out to 2024, and you can see them free on our platform here.

However, before you get too enthused, we've discovered 1 warning sign for Wirtualna Polska Holding that you should be aware of.

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