ProCredit Holding AG (ETR:PCZ) shareholders will have a reason to smile today, with the analysts making substantial upgrades to next year's statutory forecasts. The analysts have sharply increased their revenue numbers, with a view that ProCredit Holding will make substantially more sales than they'd previously expected.
After the upgrade, the three analysts covering ProCredit Holding are now predicting revenues of €410m in 2024. If met, this would reflect a solid 13% improvement in sales compared to the last 12 months. Per-share earnings are expected to jump 25% to €1.97. Before this latest update, the analysts had been forecasting revenues of €372m and earnings per share (EPS) of €1.88 in 2024. The most recent forecasts are noticeably more optimistic, with a decent improvement in revenue estimates and a lift to earnings per share as well.
Although the analysts have upgraded their earnings estimates, there was no change to the consensus price target of €15.00, suggesting that the forecast performance does not have a long term impact on the company's valuation.
One way to get more context on these forecasts is to look at how they compare to both past performance, and how other companies in the same industry are performing. It's clear from the latest estimates that ProCredit Holding's rate of growth is expected to accelerate meaningfully, with the forecast 10% annualised revenue growth to the end of 2024 noticeably faster than its historical growth of 4.9% p.a. over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to grow their revenue at 2.1% per year. It seems obvious that, while the growth outlook is brighter than the recent past, the analysts also expect ProCredit Holding to grow faster than the wider industry.
The Bottom Line
The most important thing to take away from this upgrade is that analysts upgraded their earnings per share estimates for next year, expecting improving business conditions. They also upgraded their revenue estimates for next year, and sales are expected to grow faster than the wider market. Seeing the dramatic upgrade to next year's forecasts, it might be time to take another look at ProCredit Holding.
With that said, the long-term trajectory of the company's earnings is a lot more important than next year. We have estimates - from multiple ProCredit Holding analysts - going out to 2025, and you can see them free on our platform here.
Of course, seeing company management invest large sums of money in a stock can be just as useful as knowing whether analysts are upgrading their estimates. So you may also wish to search this free list of stocks that insiders are buying.
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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.