It's been a sad week for Signify N.V. (AMS:LIGHT), who've watched their investment drop 12% to €14.15 in the week since the company reported its second-quarter result. It looks like a pretty bad result, all things considered. Although revenues of €1.3b were in line with analyst predictions, statutory earnings fell badly short, missing estimates by 38% to hit €0.15 per share. 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. We've gathered the most recent statutory forecasts to see whether the analysts have changed their earnings models, following these results.
Following last week's earnings report, Signify's eleven analysts are forecasting 2026 revenues to be €5.47b, approximately in line with the last 12 months. Statutory earnings per share are forecast to dip 4.4% to €1.26 in the same period. Yet prior to the latest earnings, the analysts had been anticipated revenues of €5.48b and earnings per share (EPS) of €1.50 in 2026. So there's definitely been a decline in sentiment after the latest results, noting the substantial drop in new EPS forecasts.
See our latest analysis for Signify
It might be a surprise to learn that the consensus price target was broadly unchanged at €17.69, with the analysts clearly implying that the forecast decline in earnings is not expected to have much of an impact on valuation. 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 Signify at €25.00 per share, while the most bearish prices it at €12.60. This is a fairly broad spread of estimates, suggesting that analysts are forecasting a wide range of possible outcomes for the business.
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 also point out that the forecast 1.2% annualised revenue decline to the end of 2026 is better than the historical trend, which saw revenues shrink 5.2% annually 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 revenue grow 9.3% per year. So while a broad number of companies are forecast to grow, unfortunately Signify is expected to see its revenue affected worse than other companies in the industry.
The Bottom Line
The biggest concern is that the analysts reduced their earnings per share estimates, suggesting business headwinds could lay ahead for Signify. 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 €17.69, with the latest estimates not enough to have an impact on their price targets.
With that in mind, we wouldn't be too quick to come to a conclusion on Signify. Long-term earnings power is much more important than next year's profits. We have forecasts for Signify going out to 2028, and you can see them free on our platform here.
Plus, you should also learn about the 4 warning signs we've spotted with Signify .
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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.