Fastighets AB Balder (publ) Just Missed Earnings - But Analysts Have Updated Their Models

Fastighets AB Balder (publ) (STO:BALD B) shareholders are probably feeling a little disappointed, since its shares fell 3.7% to kr80.30 in the week after its latest quarterly results. Statutory earnings per share fell badly short of expectations, coming in at kr0.66, some 42% below analyst forecasts, although revenues were okay, approximately in line with analyst estimates at kr3.2b. Earnings are an important time for investors, as they can track a company's performance, look at what the analysts are forecasting for next year, and see if there's been a change in sentiment towards the company. 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 Fastighets AB Balder

After the latest results, the five analysts covering Fastighets AB Balder are now predicting revenues of kr12.8b in 2024. If met, this would reflect a credible 2.1% improvement in revenue compared to the last 12 months. Earnings are expected to improve, with Fastighets AB Balder forecast to report a statutory profit of kr2.60 per share. In the lead-up to this report, the analysts had been modelling revenues of kr12.7b and earnings per share (EPS) of kr2.82 in 2024. The analysts seem to have become a little more negative on the business after the latest results, given the small dip in their earnings per share numbers for next year.

Despite cutting their earnings forecasts,the analysts have lifted their price target 11% to kr85.25, 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 Fastighets AB Balder at kr90.00 per share, while the most bearish prices it at kr83.00. This is a very narrow spread of estimates, implying either that Fastighets AB Balder is an easy company to value, or - more likely - the analysts are relying heavily on some key assumptions.

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Fastighets AB Balder's past performance and to peers in the same industry. It's pretty clear that there is an expectation that Fastighets AB Balder's revenue growth will slow down substantially, with revenues to the end of 2024 expected to display 4.2% growth on an annualised basis. This is compared to a historical growth rate of 9.6% over the past five years. Juxtapose this against the other companies in the industry with analyst coverage, which are forecast to grow their revenues (in aggregate) 4.2% annually. So it's pretty clear that, while Fastighets AB Balder's revenue growth is expected to slow, it's expected to grow roughly in line with the industry.

The Bottom Line

The most important thing to take away is that the 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 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.

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 estimates - from multiple Fastighets AB Balder analysts - going out to 2026, and you can see them free on our platform here.

Before you take the next step you should know about the 2 warning signs for Fastighets AB Balder (1 is concerning!) that we have uncovered.

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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