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Some of you may have seen it last week, DWS Group GmbH & Co. KGaA (ETR:DWS) has released its annual results to the market. Initial reaction was not positive, with the stock falling 5.6% last week to €35.72. Sales of 2.6 billion euros were in line with expectations, but statutory earnings per share (EPS) were lower than expected at 2.83 euros, or 3.0% below expectations. The analysts have updated their earnings models following these results, but it would be good to know whether they think there’s been a big change to the company’s outlook, or if it’s business as usual. We thought our readers might find interesting the latest (statutory) post-earnings forecasts by the analysts for next year.
Check out our latest analysis for DWS Group GmbH KGaA.
Following last week’s earnings report, DWS Group GmbH KGaA’s 11 analysts forecast 2024 sales of €2.65 billion, about the same as the previous 12 months. Statutory earnings per share are expected to increase by 11% to 3.13 euros. However, before the latest results, analysts had been forecasting sales of €2.72b and earnings per share (EPS) of €3.29 in 2024. It’s clear that pessimism has reared its ugly head after the latest results, leading to a deterioration in the earnings outlook. Earnings per share forecasts have also been revised slightly downward.
Despite the downward revision to earnings estimates, there was no material change to the price target of 40.84 euros, indicating that analysts believe the changes will not have a material impact on intrinsic value. It may also be useful to examine the range of analysts’ estimates to assess how different the outlier’s opinion is from the average. Currently, the most bullish analyst values DWS Group GmbH KGaA at 57.00 euros per share, while the most bearish values it at 32.00 euros. This is a fairly wide range of estimates, suggesting that the analysts are predicting a range of possible outcomes for the business.
Of course, another way to analyze these forecasts is to measure them against the industry itself. It’s clear that DWS Group GmbH KGaA’s revenue growth is expected to slow significantly, with its revenue expected to grow at an annualized rate of 1.5% to the end of 2024. This compares to a historical growth rate of 4.0% over the past five years. Compare this to other companies in the industry, which are expected to see combined revenue growth of 5.6% per year (analyst estimates). So it’s clear that while revenue growth is expected to slow, the industry as a whole is expected to grow at a faster pace than DWS Group GmbH KGaA.
conclusion
Most importantly, the analysts have revised down their earnings per share estimates, indicating a clear decline in sentiment following these results. Unfortunately, they’ve also revised down their revenue estimates, and our data shows it underperforming compared to the broader industry. Still, he cares more about earnings per share for the intrinsic value of the business. The consensus price target remains unchanged at €40.84, and the latest forecast is not significant enough to impact the target price.
That said, the long-term trajectory of the company’s earnings is far more important than next year. We have his forecasts to 2026 from multiple DWS Group GmbH KGaA analysts and are available for free on our platform here.
Remember, there may still be risks. For example, we identified 1 warning sign for DWS Group GmbH KGaA What you need to know.
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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts using only unbiased methodologies, and the articles are not intended as financial advice. This is not a recommendation to buy or sell any stock, and does not take into account your objectives or financial situation. We aim to provide long-term, focused analysis based on fundamental data. Note that our analysis may not factor in the latest announcements or qualitative material from price-sensitive companies. Simply Wall St has no position in any stocks mentioned.
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