Akzo Nobel N.V. Just Missed Earnings - But Analysts Have Updated Their Models
Shareholders might have noticed that Akzo Nobel N.V. (AMS:AKZA) filed its annual result this time last week. The early response was not positive, with shares down 2.8% to €68.44 in the past week. It was not a great result overall. While revenues of €11b were in line with analyst predictions, earnings were less than expected, missing statutory estimates by 15% to hit €2.59 per share. This is an important time for investors, as they can track a company's performance in its report, look at what experts are forecasting for next year, and see if there has been any change to expectations for the business. With this in mind, we've gathered the latest statutory forecasts to see what the analysts are expecting for next year.
See our latest analysis for Akzo Nobel
Following last week's earnings report, Akzo Nobel's 18 analysts are forecasting 2024 revenues to be €10.7b, approximately in line with the last 12 months. Per-share earnings are expected to surge 47% to €3.86. In the lead-up to this report, the analysts had been modelling revenues of €10.8b and earnings per share (EPS) of €4.00 in 2024. So it looks like there's been a small decline in overall sentiment after the recent results - there's been no major change to revenue estimates, but the analysts did make a small dip in their earnings per share forecasts.
The consensus price target held steady at €79.31, with the analysts seemingly voting that their lower forecast earnings are not expected to lead to a lower stock price in the foreseeable future. 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. The most optimistic Akzo Nobel analyst has a price target of €96.00 per share, while the most pessimistic values it at €65.00. 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 Akzo Nobel shareholders.
Taking a look at the bigger picture now, one of the ways we can understand these forecasts is to see how they compare to both past performance and industry growth estimates. We would highlight that Akzo Nobel's revenue growth is expected to slow, with the forecast 0.8% annualised growth rate until the end of 2024 being well below the historical 4.4% p.a. growth over the last five years. Compare this against other companies (with analyst forecasts) in the industry, which are in aggregate expected to see revenue growth of 3.4% annually. Factoring in the forecast slowdown in growth, it seems obvious that Akzo Nobel is also expected to grow slower than other industry participants.
The Bottom Line
The biggest concern is that the analysts reduced their earnings per share estimates, suggesting business headwinds could lay ahead for Akzo Nobel. Fortunately, the analysts also reconfirmed their revenue estimates, suggesting that it's tracking in line with expectations. Although our data does suggest that Akzo Nobel's revenue is expected to perform worse than the wider industry. The consensus price target held steady at €79.31, with the latest estimates not enough to have an impact on their price targets.
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 forecasts for Akzo Nobel going out to 2026, and you can see them free on our platform here.
You should always think about risks though. Case in point, we've spotted 2 warning signs for Akzo Nobel 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.
