Tele2 AB (publ) (STO:TEL2 B) Just Released Its Annual Earnings: Here's What Analysts Think

The annual results for Tele2 AB (publ) (STO:TEL2 B) were released last week, making it a good time to revisit its performance. Tele2 reported in line with analyst predictions, delivering revenues of kr29b and statutory earnings per share of kr5.37, suggesting the business is executing well and in line with its plan. 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. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether the analysts have changed their mind on Tele2 after the latest results.

Check out our latest analysis for Tele2

Taking into account the latest results, Tele2's 19 analysts currently expect revenues in 2024 to be kr29.7b, approximately in line with the last 12 months. Statutory earnings per share are predicted to rise 2.2% to kr5.52. Yet prior to the latest earnings, the analysts had been anticipated revenues of kr29.6b and earnings per share (EPS) of kr5.51 in 2024. So it's pretty clear that, although the analysts have updated their estimates, there's been no major change in expectations for the business following the latest results.

There were no changes to revenue or earnings estimates or the price target of kr98.35, suggesting that the company has met expectations in its recent result. The consensus price target is just an average of individual analyst targets, so - it could be handy to see how wide the range of underlying estimates is. Currently, the most bullish analyst values Tele2 at kr120 per share, while the most bearish prices it at kr81.00. Analysts definitely have varying views on the business, but the spread of estimates is not wide enough in our view to suggest that extreme outcomes could await Tele2 shareholders.

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. It's pretty clear that there is an expectation that Tele2's revenue growth will slow down substantially, with revenues to the end of 2024 expected to display 1.9% growth on an annualised basis. This is compared to a historical growth rate of 3.3% 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) 1.9% annually. So it's pretty clear that, while Tele2's revenue growth is expected to slow, it's expected to grow roughly in line with the 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. Happily, there were no real changes to revenue forecasts, with the business still expected to grow in line with the overall industry. There was no real change to the consensus price target, suggesting that the intrinsic value of the business has not undergone any major changes with the latest estimates.

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 Tele2 analysts - going out to 2026, and you can see them free on our platform here.

Don't forget that there may still be risks. For instance, we've identified 3 warning signs for Tele2 (1 is a bit unpleasant) you should be aware of.

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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.