Ceconomy AG (ETR:CEC) Just Released Its Annual Results And Analysts Are Updating Their Estimates
Investors in Ceconomy AG (ETR:CEC) had a good week, as its shares rose 3.5% to close at €2.33 following the release of its yearly results. It was a pretty bad result overall; while revenues were in line with expectations at €22b, statutory losses exploded to €0.08 per share. 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 Ceconomy
Following last week's earnings report, Ceconomy's seven analysts are forecasting 2024 revenues to be €22.4b, approximately in line with the last 12 months. Earnings are expected to improve, with Ceconomy forecast to report a statutory profit of €0.24 per share. In the lead-up to this report, the analysts had been modelling revenues of €22.2b and earnings per share (EPS) of €0.27 in 2024. The analysts seem to have become more bearish following the latest results. While there were no changes to revenue forecasts, there was a substantial drop in EPS estimates.
It might be a surprise to learn that the consensus price target was broadly unchanged at €2.34, with the analysts clearly implying that the forecast decline in earnings is not expected to have much of an impact on valuation. 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 Ceconomy analyst has a price target of €2.90 per share, while the most pessimistic values it at €1.90. These price targets show that analysts do have some differing views on the business, but the estimates do not vary enough to suggest to us that some are betting on wild success or utter failure.
Of course, another way to look at these forecasts is to place them into context against the industry itself. The period to the end of 2024 brings more of the same, according to the analysts, with revenue forecast to display 0.8% growth on an annualised basis. That is in line with its 0.7% annual growth over the past five years. Compare this with the broader industry (in aggregate), which analyst estimates suggest will see revenues grow 6.3% annually. So although Ceconomy is expected to maintain its revenue growth rate, it's forecast to grow slower than 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 Ceconomy. Fortunately, the analysts also reconfirmed their revenue estimates, suggesting that it's tracking in line with expectations. Although our data does suggest that Ceconomy's revenue is expected to perform worse than the wider 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.
With that in mind, we wouldn't be too quick to come to a conclusion on Ceconomy. Long-term earnings power is much more important than next year's profits. At Simply Wall St, we have a full range of analyst estimates for Ceconomy going out to 2026, and you can see them free on our platform here..
We don't want to rain on the parade too much, but we did also find 3 warning signs for Ceconomy (1 doesn't sit too well with us!) that you need to be mindful 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.
