Investors in SGS SA (VTX:SGSN) had a good week, as its shares rose 2.5% to close at CHF96.34 following the release of its interim results. Results were roughly in line with estimates, with revenues of CHF3.7b and statutory earnings per share of CHF3.46. 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. We've gathered the most recent statutory forecasts to see whether the analysts have changed their earnings models, following these results.
Taking into account the latest results, the current consensus from SGS' 18 analysts is for revenues of CHF7.62b in 2026. This would reflect a credible 5.7% increase on its revenue over the past 12 months. Per-share earnings are expected to rise 9.9% to CHF3.69. Before this earnings report, the analysts had been forecasting revenues of CHF7.52b and earnings per share (EPS) of CHF3.84 in 2026. The analysts seem to have become a little more negative on the business after the latest results, given the minor downgrade to their earnings per share numbers for next year.
View our latest analysis for SGS
The consensus price target held steady at CHF101, with the analysts seemingly voting that their lower forecast earnings are not expected to lead to a lower stock price in the foreseeable future. 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. Currently, the most bullish analyst values SGS at CHF124 per share, while the most bearish prices it at CHF83.00. 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. It's clear from the latest estimates that SGS' rate of growth is expected to accelerate meaningfully, with the forecast 12% annualised revenue growth to the end of 2026 noticeably faster than its historical growth of 2.4% p.a. over the past five years. Compare this with other companies in the same industry, which are forecast to grow their revenue 5.5% annually. It seems obvious that, while the growth outlook is brighter than the recent past, the analysts also expect SGS to grow faster than the wider industry.
The Bottom Line
The biggest concern is that the analysts reduced their earnings per share estimates, suggesting business headwinds could lay ahead for SGS. Fortunately, they also reconfirmed their revenue numbers, suggesting that it's tracking in line with expectations. Additionally, our data suggests that revenue is expected to grow faster than the wider industry. The consensus price target held steady at CHF101, with the latest estimates not enough to have an impact on their price targets.
With that said, the long-term trajectory of the company's earnings is a lot more important than next year. We have estimates - from multiple SGS analysts - going out to 2028, and you can see them free on our platform here.
Don't forget that there may still be risks. For instance, we've identified 2 warning signs for SGS that you should be aware of.
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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.