As you might know, Peab AB (publ) (STO:PEAB B) last week released its latest third-quarter, and things did not turn out so great for shareholders. It wasn't a great result overall - while revenue fell marginally short of analyst estimates at kr16b, statutory earnings missed forecasts by 18%, coming in at just kr3.45 per share. This is an important time for investors, as they can track a company's performance in its report, look at what experts are forecasting for next year, and see if there has been any change to expectations for the business. We thought readers would find it interesting to see the analysts latest (statutory) post-earnings forecasts for next year.
Taking into account the latest results, the consensus forecast from Peab's four analysts is for revenues of kr64.6b in 2027. This reflects a reasonable 6.6% improvement in revenue compared to the last 12 months. Statutory earnings per share are predicted to expand 13% to kr9.01. Yet prior to the latest earnings, the analysts had been anticipated revenues of kr65.0b and earnings per share (EPS) of kr8.92 in 2027. 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.
Check out our latest analysis for Peab
With the analysts reconfirming their revenue and earnings forecasts, it's surprising to see that the price target rose 8.0% to kr107. It looks as though they previously had some doubts over whether the business would live up to their expectations. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. Currently, the most bullish analyst values Peab at kr110 per share, while the most bearish prices it at kr100.00. The narrow spread of estimates could suggest that the business' future is relatively easy to value, or thatthe analysts have a strong view on its prospects.
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. One thing stands out from these estimates, which is that Peab is forecast to grow faster in the future than it has in the past, with revenues expected to display 5.2% annualised growth until the end of 2027. If achieved, this would be a much better result than the 0.3% annual decline over the past five years. Compare this against analyst estimates for the broader industry, which suggest that (in aggregate) industry revenues are expected to grow 4.6% annually. So while Peab's revenues are expected to improve, it seems that it is expected to grow at about the same rate as the overall industry.
The Bottom Line
The most important thing to take away is that there's been no major change in sentiment, with the analysts reconfirming that the business is performing in line with their previous earnings per share estimates. Happily, there were no real changes to revenue forecasts, with the business still expected to grow in line with the overall industry. We note an upgrade to the price target, suggesting that the analysts believes the intrinsic value of the business is likely to improve over time.
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 Peab analysts - going out to 2028, and you can see them free on our platform here.
That said, it's still necessary to consider the ever-present spectre of investment risk. We've identified 2 warning signs with Peab (at least 1 which is significant) , and understanding these should be part of your investment process.
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