Revenue Beat: HusCompagniet A/S Exceeded Revenue Forecasts By 7.2% And Analysts Are Updating Their Estimates

Shareholders might have noticed that HusCompagniet A/S (CPH:HUSCO) filed its quarterly result this time last week. The early response was not positive, with shares down 9.4% to kr.62.00 in the past week. Results overall were respectable, with statutory earnings of kr.13.70 per share roughly in line with what the analysts had forecast. Revenues of kr.1.2b came in 7.2% ahead of analyst predictions. 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. We thought readers would find it interesting to see the analysts latest (statutory) post-earnings forecasts for next year.

See our latest analysis for HusCompagniet

Taking into account the latest results, the current consensus, from the three analysts covering HusCompagniet, is for revenues of kr.4.37b in 2022, which would reflect a noticeable 3.8% reduction in HusCompagniet’s sales over the past 12 months. Statutory earnings per share are forecast to nosedive 21% to kr.11.61 in the same period. In the lead-up to this report, the analysts had been modelling revenues of kr.4.41b and earnings per share (EPS) of kr.12.76 in 2022. 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.

It might be a surprise to learn that the consensus price target fell 11% to kr.80.00, with the analysts clearly linking lower forecast earnings to the performance of the stock price. 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 HusCompagniet at kr.100.00 per share, while the most bearish prices it at kr.70.00. This shows there is still a bit of diversity in estimates, but analysts don’t appear to be totally split on the stock as though it might be a success or failure situation.

Another way we can view these estimates is in the context of the bigger picture, such as how the forecasts stack up against past performance, and whether forecasts are more or less bullish relative to other companies in the industry. We would highlight that sales are expected to reverse, with a forecast 5.1% annualised revenue decline to the end of 2022. That is a notable change from historical growth of 15% over the last year. Compare this with our data, which suggests that other companies in the same industry are, in aggregate, expected to see their revenue grow 4.5% per year. So although its revenues are forecast to shrink, this cloud does not come with a silver lining – HusCompagniet is expected to lag the wider industry.

The Bottom Line

The biggest concern is that the analysts reduced their earnings per share estimates, suggesting business headwinds could lay ahead for HusCompagniet. On the plus side, there were no major changes to revenue estimates; although forecasts imply revenues will perform worse than the wider industry. The consensus price target fell measurably, with the analysts seemingly not reassured by the latest results, leading to a lower estimate of HusCompagniet’s future valuation.

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 forecasts for HusCompagniet going out to 2024, and you can see them free on our platform here.

You should always think about risks though. Case in point, we’ve spotted 3 warning signs for HusCompagniet you should be aware of, and 1 of them is significant.

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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.