VBG Group AB (publ) Just Beat Analyst Forecasts, And Analysts Have Been Updating Their Predictions

It's been a good week for VBG Group AB (publ) (STO:VBG B) shareholders, because the company has just released its latest annual results, and the shares gained 8.0% to kr278. VBG Group reported kr5.7b in revenue, roughly in line with analyst forecasts, although statutory earnings per share (EPS) of kr22.74 beat expectations, being 5.3% higher than what the analyst expected. Earnings are an important time for investors, as they can track a company's performance, look at what the analyst is forecasting for next year, and see if there's been a change in sentiment towards the company. With this in mind, we've gathered the latest statutory forecasts to see what the analyst is expecting for next year.

See our latest analysis for VBG Group

After the latest results, the consensus from VBG Group's sole analyst is for revenues of kr5.52b in 2024, which would reflect a measurable 3.8% decline in revenue compared to the last year of performance. Statutory earnings per share are forecast to reduce 5.7% to kr21.46 in the same period. In the lead-up to this report, the analyst had been modelling revenues of kr5.38b and earnings per share (EPS) of kr19.88 in 2024. So there seems to have been a moderate uplift in sentiment following the latest results, given the upgrades to both revenue and earnings per share forecasts for next year.

It will come as no surprise to learn that the analyst has increased their price target for VBG Group 11% to kr355on the back of these upgrades.

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. These estimates imply that revenue is expected to slow, with a forecast annualised decline of 3.8% by the end of 2024. This indicates a significant reduction from annual growth of 9.4% over the last five years. By contrast, our data suggests that other companies (with analyst coverage) in the same industry are forecast to see their revenue grow 3.1% annually for the foreseeable future. So although its revenues are forecast to shrink, this cloud does not come with a silver lining - VBG Group is expected to lag the wider industry.

The Bottom Line

The most important thing here is that the analyst upgraded their earnings per share estimates, suggesting that there has been a clear increase in optimism towards VBG Group following these results. Fortunately, they also upgraded their revenue estimates, although our data indicates it is expected to perform worse than the wider industry. We note an upgrade to the price target, suggesting that the analyst believes the intrinsic value of the business is likely to improve over time.

With that in mind, we wouldn't be too quick to come to a conclusion on VBG Group. Long-term earnings power is much more important than next year's profits. We have analyst estimates for VBG Group going out as far as 2026, and you can see them free on our platform here.

It is also worth noting that we have found 1 warning sign for VBG Group that you need to take into consideration.

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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.