Vasta Platform Limited (NASDAQ:VSTA) Analysts Are Cutting Their Estimates: Here's What You Need To Know

Vasta Platform Limited (NASDAQ:VSTA) shareholders are probably feeling a little disappointed, since its shares fell 9.3% to US$9.90 in the week after its latest full-year results. The result was fairly weak overall, with revenues of R$998m being 3.2% less than what the analysts had been modelling. 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.

Check out our latest analysis for Vasta Platform

Following the latest results, Vasta Platform's five analysts are now forecasting revenues of R$1.08b in 2021. This would be a solid 8.2% improvement in sales compared to the last 12 months. Yet prior to the latest earnings, the analysts had been anticipated revenues of R$1.16b and earnings per share (EPS) of R$2.21 in 2021. So we can see that while the consensus made a minor downgrade to revenue estimates, it no longer provides an earnings per share estimate, suggesting that the market is now more focused on revenue after the latest result.

There's been no real change to the consensus price target of R$110, with Vasta Platform seemingly executing in line with expectations. 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. The most optimistic Vasta Platform analyst has a price target of R$21.86 per share, while the most pessimistic values it at R$16.83. With such a narrow range of valuations, the analysts apparently share similar views on what they think the business is worth.

Of course, another way to look at these forecasts is to place them into context against the industry itself. It's clear from the latest estimates that Vasta Platform's rate of growth is expected to accelerate meaningfully, with the forecast 8.2% annualised revenue growth to the end of 2021 noticeably faster than its historical growth of 0.8% over the past year. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to grow their revenue at 19% per year. So it's clear that despite the acceleration in growth, Vasta Platform is expected to grow meaningfully slower than the industry average.

The Bottom Line

The most important thing to take away is that the analysts downgraded their revenue estimates for next year. On the negative side, they also downgraded their revenue estimates, and forecasts imply revenues will perform worse than the wider industry. The consensus price target held steady at R$110, with the latest estimates not enough to have an impact on their price targets.

At least one of Vasta Platform's five analysts has provided estimates out to 2023, which can be seen for free on our platform here.

You should always think about risks though. Case in point, we've spotted 1 warning sign for Vasta Platform you should be aware of.

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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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