Attendo AB (publ) (STO:ATT) came out with its annual results last week, and we wanted to see how the business is performing and what top analysts think of the company following this report. It looks like the results were a bit of a negative overall. While revenues of kr12b were in line with analyst predictions, statutory earnings were less than expected, missing estimates by 2.8% to hit kr0.51 per share. Following the result, 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 thought readers would find it interesting to see analysts’ latest (statutory) post-earnings forecasts for next year.
Taking into account the latest results, the current consensus from Attendo’s three analysts is for revenues of kr13.0b in 2020, which would reflect a notable 9.3% increase on its sales over the past 12 months. Statutory earnings per share are expected to bounce 24% to kr0.63. Yet prior to the latest earnings, analysts had been forecasting revenues of kr13.1b and earnings per share (EPS) of kr0.67 in 2020. 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 analysts did make a small dip in their earnings per share forecasts.
Despite cutting their earnings forecasts, analysts have lifted their price target 11% to kr50.00, suggesting that these impacts are not expected to weigh on the stock’s value in the long term. 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. Currently, the most bullish analyst values Attendo at kr60.00 per share, while the most bearish prices it at kr40.00. This shows there is still quite 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.
Another way to assess these estimates is by comparing them to past performance, and seeing whether analysts are more or less bullish relative to other companies in the market. Analysts are definitely expecting Attendo’s growth to accelerate, with the forecast 9.3% growth ranking favourably alongside historical growth of 4.5% per annum over the past five years. Other similar companies in the industry (with analyst coverage) are also forecast to grow their revenue at 8.6% per year. Factoring in the forecast acceleration in revenue, it’s pretty clear that Attendo is expected to grow at about the same rate as the wider market.
The Bottom Line
The most important thing to take away is that analysts downgraded their earnings per share estimates, showing that there has been a clear decline in sentiment following these results. They also reconfirmed their revenue estimates, with the company predicted to grow at about the same rate as the wider market. There was also a nice increase in the price target, with analysts feeling that the intrinsic value of the business is improving.
Still, 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 Attendo going out to 2022, and you can see them free on our platform here..
You can also see whether Attendo is carrying too much debt, and whether its balance sheet is healthy, for free on our platform here.
If you spot an error that warrants correction, please contact the editor at email@example.com. 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. Simply Wall St has no position in the stocks mentioned.
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