Last week, you might have seen that Motor Oil (Hellas) Corinth Refineries S.A. (ATH:MOH) released its yearly result to the market. The early response was not positive, with shares down 2.8% to €11.86 in the past week. It was not a great result overall. While revenues of €9.4b were in line with analyst predictions, earnings were less than expected, missing statutory estimates by 17% to hit €2.03 per share. Following the result, the analysts have updated their earnings model, and it would be good to know whether they think there's been a strong change in the company's prospects, or if it's business as usual. We've gathered the most recent statutory forecasts to see whether the analysts have changed their earnings models, following these results.
Taking into account the latest results, the current consensus, from the six analysts covering Motor Oil (Hellas) Corinth Refineries, is for revenues of €6.80b in 2020, which would reflect a disturbing 27% reduction in Motor Oil (Hellas) Corinth Refineries's sales over the past 12 months. Per-share earnings are expected to expand 14% to €2.34. Before this earnings report, the analysts had been forecasting revenues of €9.25b and earnings per share (EPS) of €2.74 in 2020. Indeed, we can see that the analysts are a lot more bearish about Motor Oil (Hellas) Corinth Refineries's prospects following the latest results, administering a pretty serious reduction to revenue estimates and slashing their EPS estimates to boot.
The consensus price target fell 8.0% to €21.30, with the weaker earnings outlook clearly leading valuation estimates. 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. Currently, the most bullish analyst values Motor Oil (Hellas) Corinth Refineries at €29.00 per share, while the most bearish prices it at €10.00. 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.
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. These estimates imply that sales are expected to slow, with a forecast revenue decline of 27%, a significant reduction from annual growth of 5.5% over the last five years. By contrast, our data suggests that other companies (with analyst coverage) in the same industry are forecast to see their revenue grow 2.5% annually for the foreseeable future. It's pretty clear that Motor Oil (Hellas) Corinth Refineries's revenues are expected to perform substantially worse than the wider industry.
The Bottom Line
The most important thing to take away is that the analysts downgraded their earnings per share estimates, showing that there has been a clear decline in sentiment following these results. On the negative side, they also downgraded their revenue estimates, and forecasts imply revenues will perform worse than the wider industry. Furthermore, the analysts also cut their price targets, suggesting that the latest news has led to greater pessimism about the intrinsic value of the business.
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 estimates - from multiple Motor Oil (Hellas) Corinth Refineries analysts - going out to 2022, and you can see them free on our platform here.
Don't forget that there may still be risks. For instance, we've identified 4 warning signs for Motor Oil (Hellas) Corinth Refineries (1 is a bit unpleasant) you should be aware of.
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