Viaplay Group AB (publ) (STO:VPLAY B) Released Earnings Last Week And Analysts Lifted Their Price Target To kr1.03

It's been a pretty great week for Viaplay Group AB (publ) (STO:VPLAY B) shareholders, with its shares surging 13% to kr0.99 in the week since its latest quarterly results. It was a pretty bad result overall; while revenues were in line with expectations at kr4.5b, statutory losses exploded to kr0.03 per share. 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. 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 Viaplay Group

Taking into account the latest results, Viaplay Group's five analysts currently expect revenues in 2024 to be kr18.5b, approximately in line with the last 12 months. Viaplay Group is also expected to turn profitable, with statutory earnings of kr0.091 per share. In the lead-up to this report, the analysts had been modelling revenues of kr18.4b and earnings per share (EPS) of kr0.091 in 2024. The consensus analysts don't seem to have seen anything in these results that would have changed their view on the business, given there's been no major change to their estimates.

The consensus price target rose 11% to kr1.03despite there being no meaningful change to earnings estimates. It could be that the analystsare reflecting the predictability of Viaplay Group's earnings by assigning a price premium. There's another way to think about price targets though, and that's to look at the range of price targets put forward by analysts, because a wide range of estimates could suggest a diverse view on possible outcomes for the business. There are some variant perceptions on Viaplay Group, with the most bullish analyst valuing it at kr1.10 and the most bearish at kr0.95 per share. Still, with such a tight range of estimates, it suggeststhe analysts have a pretty good idea of what they think the company is worth.

Of course, another way to look at these forecasts is to place them into context against the industry itself. We would highlight that revenue is expected to reverse, with a forecast 1.9% annualised decline to the end of 2024. That is a notable change from historical growth of 7.9% over the last five years. Compare this with our data, which suggests that other companies in the same industry are, in aggregate, expected to see their revenue grow 5.2% per year. So although its revenues are forecast to shrink, this cloud does not come with a silver lining - Viaplay Group is expected to lag the wider industry.

The Bottom Line

The most obvious conclusion is that there's been no major change in the business' prospects in recent times, with the analysts holding their earnings forecasts steady, in line with previous estimates. On the plus side, there were no major changes to revenue estimates; although forecasts imply they will perform worse than the wider industry. We note an upgrade to the price target, suggesting that the analysts believes the intrinsic value of the business is likely to improve over time.

Following on from that line of thought, we think that the long-term prospects of the business are much more relevant than next year's earnings. We have estimates - from multiple Viaplay Group analysts - going out to 2026, and you can see them free on our platform here.

Plus, you should also learn about the 3 warning signs we've spotted with Viaplay Group (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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com