Nordic Paper Holding AB (publ) Earnings Missed Analyst Estimates: Here's What Analysts Are Forecasting Now

Shareholders might have noticed that Nordic Paper Holding AB (publ) (STO:NPAPER) filed its quarterly result this time last week. The early response was not positive, with shares down 2.9% to kr49.25 in the past week. It was not a great result overall. Although revenues beat expectations, hitting kr772m, statutory earnings missed analyst forecasts by 12%, coming in at just kr1.21 per share. The analysts typically update their forecasts at each earnings report, and we can judge from their estimates whether their view of the company has changed or if there are any new concerns to be aware of. So we collected the latest post-earnings statutory consensus estimates to see what could be in store for next year.

View our latest analysis for Nordic Paper Holding

Taking into account the latest results, the consensus forecast from Nordic Paper Holding's two analysts is for revenues of kr3.02b in 2021, which would reflect a credible 5.5% improvement in sales compared to the last 12 months. Statutory earnings per share are forecast to dip 8.6% to kr2.96 in the same period. In the lead-up to this report, the analysts had been modelling revenues of kr2.98b and earnings per share (EPS) of kr4.42 in 2021. The analysts seem to have become more bearish following the latest results. While there were no changes to revenue forecasts, there was a large cut to EPS estimates.

It might be a surprise to learn that the consensus price target was broadly unchanged at kr57.50, with the analysts clearly implying that the forecast decline in earnings is not expected to have much of an impact on valuation.

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. For example, we noticed that Nordic Paper Holding's rate of growth is expected to accelerate meaningfully, with revenues forecast to exhibit 7.4% growth to the end of 2021 on an annualised basis. That is well above its historical decline of 10% a year over the past year. By contrast, our data suggests that other companies (with analyst coverage) in the industry are forecast to see their revenue grow 2.5% per year. So it looks like Nordic Paper Holding is expected to grow faster than its competitors, at least for a while.

The Bottom Line

The biggest concern is that the analysts reduced their earnings per share estimates, suggesting business headwinds could lay ahead for Nordic Paper Holding. Happily, there were no major changes to revenue forecasts, with the business still expected to grow faster than the wider industry. The consensus price target held steady at kr57.50, 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. We have analyst estimates for Nordic Paper Holding going out as far as 2023, and you can see them free on our platform here.

Even so, be aware that Nordic Paper Holding is showing 4 warning signs in our investment analysis , you should know about...

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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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