It's been a good week for Devro plc (LON:DVO) shareholders, because the company has just released its latest full-year results, and the shares gained 7.8% to UK£1.88. It looks like a credible result overall - although revenues of UK£248m were what the analysts expected, Devro surprised by delivering a (statutory) profit of UK£0.14 per share, an impressive 30% above what was forecast. The analysts typically update their forecasts at each earnings report, and we can judge from their estimates whether their view of the company has changed or if there are any new concerns to be aware of. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether the analysts have changed their mind on Devro after the latest results.
View our latest analysis for Devro
Taking into account the latest results, the current consensus from Devro's four analysts is for revenues of UK£253.1m in 2021, which would reflect a credible 2.2% increase on its sales over the past 12 months. Per-share earnings are expected to step up 11% to UK£0.15. In the lead-up to this report, the analysts had been modelling revenues of UK£255.4m and earnings per share (EPS) of UK£0.16 in 2021. So it's pretty clear that, although the analysts have updated their estimates, there's been no major change in expectations for the business following the latest results.
It will come as no surprise then, to learn that the consensus price target is largely unchanged at UK£1.97. 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. There are some variant perceptions on Devro, with the most bullish analyst valuing it at UK£2.40 and the most bearish at UK£1.70 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.
Taking a look at the bigger picture now, one of the ways we can understand these forecasts is to see how they compare to both past performance and industry growth estimates. The analysts are definitely expecting Devro's growth to accelerate, with the forecast 2.2% annualised growth to the end of 2021 ranking favourably alongside historical growth of 1.4% per annum over the past five years. Compare this with other companies in the same industry, which are forecast to see revenue growth of 5.4% annually. So it's clear that despite the acceleration in growth, Devro is expected to grow meaningfully slower than the industry average.