Public Joint Stock Company Mosenergo Just Missed EPS By 11%: Here's What Analysts Think Will Happen Next

As you might know, Public Joint Stock Company Mosenergo (MCX:MSNG) recently reported its yearly numbers. Revenues were in line with forecasts, at ₽181b, although statutory earnings per share came in 11% below what the analysts expected, at ₽0.20 per share. Following the result, the analysts have updated their earnings model, and it would be good to know whether they think there's been a strong change in the company's prospects, or if it's business as usual. We've gathered the most recent statutory forecasts to see whether the analysts have changed their earnings models, following these results.

See our latest analysis for Mosenergo

After the latest results, the four analysts covering Mosenergo are now predicting revenues of ₽187.0b in 2021. If met, this would reflect an okay 3.4% improvement in sales compared to the last 12 months. Statutory earnings per share are predicted to jump 33% to ₽0.27. Before this earnings report, the analysts had been forecasting revenues of ₽187.9b and earnings per share (EPS) of ₽0.26 in 2021. So the consensus seems to have become somewhat more optimistic on Mosenergo's earnings potential following these results.

There's been no major changes to the consensus price target of ₽2.31, suggesting that the improved earnings per share outlook is not enough to have a long-term positive impact on the stock's valuation. 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. There are some variant perceptions on Mosenergo, with the most bullish analyst valuing it at ₽2.52 and the most bearish at ₽2.00 per share. This is a very narrow spread of estimates, implying either that Mosenergo is an easy company to value, or - more likely - the analysts are relying heavily on some key assumptions.

Looking at the bigger picture now, one of the ways we can make sense of these forecasts is to see how they measure up against both past performance and industry growth estimates. It's clear from the latest estimates that Mosenergo's rate of growth is expected to accelerate meaningfully, with the forecast 3.4% annualised revenue growth to the end of 2021 noticeably faster than its historical growth of 0.2% p.a. over the past five years. Compare this with other companies in the same industry, which are forecast to grow their revenue 3.2% annually. Mosenergo is expected to grow at about the same rate as its industry, so it's not clear that we can draw any conclusions from its growth relative to competitors.

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 Mosenergo following these results. They also reconfirmed their revenue estimates, with the company predicted to grow at about the same rate as 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.

Following on from that line of thought, we think that the long-term prospects of the business are much more relevant than next year's earnings. At Simply Wall St, we have a full range of analyst estimates for Mosenergo going out to 2025, and you can see them free on our platform here..

You should always think about risks though. Case in point, we've spotted 1 warning sign for Mosenergo you should be aware of.

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This article by Simply Wall St is general in nature. 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.
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