It’s been a good week for DATAGROUP SE (ETR:D6H) shareholders, because the company has just released its latest annual results, and the shares gained 2.8% to €54.20. DATAGROUP reported in line with analyst predictions, delivering revenues of €496m and statutory earnings per share of €3.39, suggesting the business is executing well and in line with its plan. Earnings are an important time for investors, as they can track a company’s performance, look at what the analysts are forecasting for next year, and see if there’s been a change in sentiment towards the company. With this in mind, we’ve gathered the latest statutory forecasts to see what the analysts are expecting for next year.
Following the latest results, DATAGROUP’s six analysts are now forecasting revenues of €530.5m in 2024. This would be a reasonable 7.0% improvement in revenue compared to the last 12 months. Statutory earnings per share are predicted to rise 7.5% to €3.62. Before this earnings report, the analysts had been forecasting revenues of €529.5m and earnings per share (EPS) of €3.62 in 2024. The consensus analysts don’t seem to have seen anything in these results that would have changed their view on the business, given there’s been no major change to their estimates.
The analysts reconfirmed their price target of €84.92, showing that the business is executing well and in line with expectations. There’s another way to think about price targets though, and that’s to look at the range of price targets put forward by analysts, because a wide range of estimates could suggest a diverse view on possible outcomes for the business. Currently, the most bullish analyst values DATAGROUP at €114 per share, while the most bearish prices it at €72.00. These price targets show that analysts do have some differing views on the business, but the estimates do not vary enough to suggest to us that some are betting on wild success or utter failure.
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. We would highlight that DATAGROUP’s revenue growth is expected to slow, with the forecast 7.0% annualised growth rate until the end of 2024 being well below the historical 13% p.a. growth over the last five years. Compare this against other companies (with analyst forecasts) in the industry, which are in aggregate expected to see revenue growth of 9.2% annually. So it’s pretty clear that, while revenue growth is expected to slow down, the wider industry is also expected to grow faster than DATAGROUP.
The Bottom Line
The most obvious conclusion is that there’s been no major change in the business’ prospects in recent times, with the analysts holding their earnings forecasts steady, in line with previous estimates. On the plus side, there were no major changes to revenue estimates; although forecasts imply they will perform worse than the wider industry. The consensus price target held steady at €84.92, with the latest estimates not enough to have an impact on their price targets.
Following on from that line of thought, we think that the long-term prospects of the business are much more relevant than next year’s earnings. We have forecasts for DATAGROUP going out to 2026, and you can see them free on our platform here.
We don’t want to rain on the parade too much, but we did also find 2 warning signs for DATAGROUP that you need to be mindful of.
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Find out whether DATAGROUP is potentially over or undervalued by checking out our comprehensive analysis, which includes fair value estimates, risks and warnings, dividends, insider transactions and financial health.
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