Coloplast A/S Just Reported And Analysts Have Been Lifting Their Price Targets
Shareholders of Coloplast A/S (CPH:COLO B) will be pleased this week, given that the stock price is up 10% to ø938 following its latest quarterly results. The result was positive overall - although revenues of ø4.7b were in line with what analysts predicted, Coloplast surprised by delivering a statutory profit of ø5.12 per share, modestly greater than expected. This is an important time for investors, as they can track a company's performance in its report, look at what top analysts 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 analysts are expecting for next year.
Check out our latest analysis for Coloplast
Following the latest results, Coloplast's 17 analysts are now forecasting revenues of ø19.4b in 2020. This would be a credible 5.9% improvement in sales compared to the last 12 months. Statutory earnings per share are expected to step up 16% to ø21.72. Yet prior to the latest earnings, analysts had been forecasting revenues of ø19.4b and earnings per share (EPS) of ø21.71 in 2020. So it's pretty clear that, although analysts have updated their estimates, there's been no major change in expectations for the business following the latest results.
With analysts reconfirming their revenue and earnings forecasts, it's surprising to see that the price target rose 5.7% to ø743. It looks as though analysts previously had some doubts over whether the business would live up to their expectations. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. The most optimistic Coloplast analyst has a price target of ø990 per share, while the most pessimistic values it at ø460. Note the wide gap in analyst price targets? This implies to us that there is a fairly broad range of possible scenarios for the underlying business.
In addition, we can look to Coloplast's past performance and see whether business is expected to improve, and if the company is expected to perform better than wider market. We can infer from the latest estimates that analysts are expecting a continuation of Coloplast's historical trends, as next year's forecast 5.9% revenue growth is roughly in line with 6.5% annual revenue growth over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to see their revenues grow 8.6% per year. So it's pretty clear that Coloplast is expected to grow slower than similar companies in the same market.
The Bottom Line
The most obvious conclusion from these results is that there's been no major change in the business' prospects in recent times, with analysts holding earnings per share steady, in line with previous estimates. On the plus side, there were no major changes to revenue estimates; although analyst forecasts imply revenues will perform worse than the wider market. Analysts also upgraded their price target, suggesting that analysts believe the intrinsic value of the business is likely to improve over time.
Even so, the longer term trajectory of the business is much more important for the value creation of shareholders. We have forecasts for Coloplast going out to 2024, and you can see them free on our platform here.
You can also see whether Coloplast is carrying too much debt, and whether its balance sheet is healthy, for free on our platform here.
If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.com. 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. Simply Wall St has no position in the stocks mentioned.
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