Swedbank AB (publ) (STO:SWED A) First-Quarter Results Just Came Out: Here's What Analysts Are Forecasting For This Year

Last week, you might have seen that Swedbank AB (publ) (STO:SWED A) released its first-quarter result to the market. The early response was not positive, with shares down 2.5% to kr209 in the past week. The result was positive overall - although revenues of kr18b were in line with what the analysts predicted, Swedbank surprised by delivering a statutory profit of kr7.47 per share, modestly greater than expected. 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.

View our latest analysis for Swedbank

Taking into account the latest results, the 13 analysts covering Swedbank provided consensus estimates of kr70.8b revenue in 2024, which would reflect a discernible 2.7% decline over the past 12 months. Statutory earnings per share are forecast to dip 9.6% to kr28.11 in the same period. Yet prior to the latest earnings, the analysts had been anticipated revenues of kr70.7b and earnings per share (EPS) of kr27.34 in 2024. So the consensus seems to have become somewhat more optimistic on Swedbank's earnings potential following these results.

The consensus price target was unchanged at kr236, implying that the improved earnings outlook is not expected to have a long term impact on value creation for shareholders. 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. There are some variant perceptions on Swedbank, with the most bullish analyst valuing it at kr270 and the most bearish at kr195 per share. As you can see, analysts are not all in agreement on the stock's future, but the range of estimates is still reasonably narrow, which could suggest that the outcome is not totally unpredictable.

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. We would highlight that revenue is expected to reverse, with a forecast 3.6% annualised decline to the end of 2024. That is a notable change from historical growth of 11% over the last five years. By contrast, our data suggests that other companies (with analyst coverage) in the industry are forecast to see their revenue decline 1.4% annually for the foreseeable future. So it's pretty clear that Swedbank's revenues are expected to shrink faster than the wider industry.

The Bottom Line

The biggest takeaway for us is the consensus earnings per share upgrade, which suggests a clear improvement in sentiment around Swedbank's earnings potential next year. They also made no changes to their revenue estimates, implying the business is not expected to experience any major impacts to the current trajectory in the near term, even though it is expected to trail the wider industry. The consensus price target held steady at kr236, with the latest estimates not enough to have an impact on their price targets.

Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. At Simply Wall St, we have a full range of analyst estimates for Swedbank going out to 2026, and you can see them free on our platform here..

Plus, you should also learn about the 2 warning signs we've spotted with Swedbank (including 1 which shouldn't be ignored) .

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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.