Jerónimo Martins, SGPS, S.A. (ELI:JMT) Just Reported Half-Year Earnings: Have Analysts Changed Their Mind On The Stock?

Shareholders in Jerónimo Martins, SGPS, S.A. (ELI:JMT) had a terrible week, as shares crashed 21% to €15.58 in the week since its latest half-year results. Revenues of €16b were in line with forecasts, although statutory earnings per share (EPS) came in below expectations at €0.40, missing estimates by 2.4%. 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. So we collected the latest post-earnings statutory consensus estimates to see what could be in store for next year.

View our latest analysis for Jerónimo Martins SGPS

Taking into account the latest results, the current consensus from Jerónimo Martins SGPS' 19 analysts is for revenues of €33.7b in 2024. This would reflect a credible 4.1% increase on its revenue over the past 12 months. Statutory per-share earnings are expected to be €1.05, roughly flat on the last 12 months. Yet prior to the latest earnings, the analysts had been anticipated revenues of €33.9b and earnings per share (EPS) of €1.13 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 minor downgrade to their earnings per share forecasts.

The consensus price target held steady at €22.65, with the analysts seemingly voting that their lower forecast earnings are not expected to lead to a lower stock price in the foreseeable future. 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 Jerónimo Martins SGPS at €27.50 per share, while the most bearish prices it at €16.00. 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.

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Jerónimo Martins SGPS' past performance and to peers in the same industry. We would highlight that Jerónimo Martins SGPS' revenue growth is expected to slow, with the forecast 8.4% annualised growth rate until the end of 2024 being well below the historical 13% p.a. growth over the last five years. By way of comparison, the other companies in this industry with analyst coverage are forecast to grow their revenue at 4.2% annually. Even after the forecast slowdown in growth, it seems obvious that Jerónimo Martins SGPS is also expected to grow faster than 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 Jerónimo Martins SGPS. Happily, there were no major changes to revenue forecasts, with the business still expected to grow faster than the wider industry. The consensus price target held steady at €22.65, with the latest estimates not enough to have an impact on their price targets.

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

Even so, be aware that Jerónimo Martins SGPS is showing 2 warning signs in our investment analysis , you should know about...

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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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com