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It's been a good week for Brenntag SE (ETR:BNR) shareholders, because the company has just released its latest first-quarter results, and the shares gained 2.1% to €76.24. Revenues were €4.5b, approximately in line with expectations, although statutory earnings per share (EPS) performed substantially better. EPS of €1.40 were also better than expected, beating analyst predictions by 12%. This is an important time for investors, as they can track a company's performance in its report, look at what experts are forecasting for next year, and see if there has been any change to expectations for the business. So we gathered the latest post-earnings forecasts to see what estimates suggest is in store for next year.
See our latest analysis for Brenntag
Taking into account the latest results, the 15 analysts covering Brenntag provided consensus estimates of €18.8b revenue in 2023, which would reflect a perceptible 3.3% decline on its sales over the past 12 months. Statutory earnings per share are expected to decrease 3.1% to €5.35 in the same period. Yet prior to the latest earnings, the analysts had been anticipated revenues of €18.5b and earnings per share (EPS) of €5.15 in 2023. The analysts seems to have become more bullish on the business, judging by their new earnings per share estimates.
The consensus price target was unchanged at €87.50, implying that the improved earnings outlook is not expected to have a long term impact on value creation for shareholders. 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. There are some variant perceptions on Brenntag, with the most bullish analyst valuing it at €100.00 and the most bearish at €73.00 per share. As you can see, analysts are not all in agreement on the stock's future, but the range of estimates is still reasonably narrow, which could suggest that the outcome is not totally unpredictable.
These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Brenntag's past performance and to peers in the same industry. These estimates imply that sales are expected to slow, with a forecast annualised revenue decline of 4.3% by the end of 2023. This indicates a significant reduction from annual growth of 9.5% 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 4.3% annually for the foreseeable future. So although its revenues are forecast to shrink, this cloud does not come with a silver lining - Brenntag is expected to lag the wider industry.