Party Time: Brokers Just Made Major Increases To Their CoinShares International Limited (STO:CS) Earnings Forecasts

CoinShares International Limited (STO:CS) shareholders will have a reason to smile today, with the analysts making substantial upgrades to next year’s statutory forecasts. The analysts greatly increased their revenue estimates, suggesting a stark improvement in business fundamentals. Investors have been pretty optimistic on CoinShares International too, with the stock up 23% to kr48.80 over the past week. We’ll be curious to see if these new estimates convince the market to lift the stock price higher still.

Following the upgrade, the most recent consensus for CoinShares International from its twin analysts is for revenues of UK£54m in 2024 which, if met, would be a huge 24% increase on its sales over the past 12 months. Losses are expected to turn into profits real soon, with the analysts forecasting UK£0.40 in per-share earnings. Before this latest update, the analysts had been forecasting revenues of UK£46m and earnings per share (EPS) of UK£0.11 in 2024. So we can see there’s been a pretty clear increase in analyst sentiment in recent times, with both revenues and earnings per share receiving a decent lift in the latest estimates.

View our latest analysis for CoinShares International

Although the analysts have upgraded their earnings estimates, there was no change to the consensus price target of UK£5.29, suggesting that the forecast performance does not have a long term impact on the company’s valuation. 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 CoinShares International at UK£6.38 per share, while the most bearish prices it at UK£4.20. This shows there is still some diversity in estimates, but analysts don’t appear to be totally split on the stock as though it might be a success or failure situation.

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. We can infer from the latest estimates that forecasts expect a continuation of CoinShares International’shistorical trends, as the 19% annualised revenue growth to the end of 2024 is roughly in line with the 20% annual revenue growth over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to see their revenues grow 14% per year. So although CoinShares International is expected to maintain its revenue growth rate, it’s definitely expected to grow faster than the wider industry.

The Bottom Line

The most important thing to take away from this upgrade is that analysts upgraded their earnings per share estimates for next year, expecting improving business conditions. Fortunately, analysts also upgraded their revenue estimates, and our data indicates sales are expected to perform better than the wider market. Some investors might be disappointed to see that the price target is unchanged, but we feel that improving fundamentals are usually a positive – assuming these forecasts are met! So CoinShares International could be a good candidate for more research.

Even so, the longer term trajectory of the business is much more important for the value creation of shareholders. We have analyst estimates for CoinShares International going out as far as 2026, and you can see them free on our platform here.

Of course, seeing company management invest large sums of money in a stock can be just as useful as knowing whether analysts are upgrading their estimates. So you may also wish to search this free list of stocks that insiders are buying.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.