The quarterly results for Green Landscaping Group AB (publ) (STO:GREEN) were released last week, making it a good time to revisit its performance. Statutory earnings per share fell badly short of expectations, coming in at kr0.41, some 22% below analyst forecasts, although revenues were okay, approximately in line with analyst estimates at kr552m. 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. We've gathered the most recent statutory forecasts to see whether the analyst has changed their earnings models, following these results.
Taking into account the latest results, the consensus forecast from Green Landscaping Group's one analyst is for revenues of kr2.48b in 2021, which would reflect a major 26% improvement in sales compared to the last 12 months. Statutory earnings per share are predicted to shoot up 311% to kr2.12. Before this earnings report, the analyst had been forecasting revenues of kr2.44b and earnings per share (EPS) of kr2.06 in 2021. The analyst seem to have become more bullish on the business, judging by their new earnings per share estimates.
There's been no major changes to the consensus price target of kr43.00, suggesting that the improved earnings per share outlook is not enough to have a long-term positive impact on the stock's valuation.
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. Next year brings more of the same, according to the analyst, with revenue forecast to grow 26%, in line with its 25% annual growth over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to see their revenues grow 5.3% per year. So it's pretty clear that Green Landscaping Group is forecast to grow substantially faster than its 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 Green Landscaping Group following these results. Fortunately, they also reconfirmed their revenue numbers, suggesting sales are tracking in line with expectations - and our data suggests that revenues are expected to grow faster than the wider industry. The consensus price target held steady at kr43.00, with the latest estimates not enough to have an impact on their price target.
With that in mind, we wouldn't be too quick to come to a conclusion on Green Landscaping Group. Long-term earnings power is much more important than next year's profits. We have analyst estimates for Green Landscaping Group going out as far as 2022, and you can see them free on our platform here.
Even so, be aware that Green Landscaping Group is showing 4 warning signs in our investment analysis , and 1 of those is potentially serious...
If you decide to trade Green Landscaping Group, use the lowest-cost* platform that is rated #1 Overall by Barron’s, Interactive Brokers. Trade stocks, options, futures, forex, bonds and funds on 135 markets, all from a single integrated account.
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.
*Interactive Brokers Rated Lowest Cost Broker by StockBrokers.com Annual Online Review 2020
Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email firstname.lastname@example.org.