United Internet AG (ETR:UTDI) just released its latest quarterly results and things are looking bullish. The company beat expectations with revenues of €1.5b arriving 2.4% ahead of forecasts. Statutory earnings per share (EPS) were €0.54, 8.9% ahead of estimates. 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. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether the analysts have changed their mind on United Internet after the latest results.
After the latest results, the 16 analysts covering United Internet are now predicting revenues of €6.04b in 2023. If met, this would reflect a satisfactory 4.6% improvement in sales compared to the last 12 months. Statutory earnings per share are predicted to ascend 12% to €2.26. Yet prior to the latest earnings, the analysts had been anticipated revenues of €6.03b and earnings per share (EPS) of €2.27 in 2023. 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 €36.87, showing that the business is executing well and in line with 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. The most optimistic United Internet analyst has a price target of €55.00 per share, while the most pessimistic values it at €21.10. 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. It's pretty clear that there is an expectation that United Internet's revenue growth will slow down substantially, with revenues to the end of 2023 expected to display 3.7% growth on an annualised basis. This is compared to a historical growth rate of 5.7% over the past five years. Juxtapose this against the other companies in the industry with analyst coverage, which are forecast to grow their revenues (in aggregate) 3.1% annually. So it's pretty clear that, while United Internet's revenue growth is expected to slow, it's expected to grow roughly in line with the industry.
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. Happily, there were no real changes to sales forecasts, with the business still expected to grow in line with the overall industry. There was no real change to the consensus price target, suggesting that the intrinsic value of the business has not undergone any major changes with the latest estimates.
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 estimates - from multiple United Internet analysts - going out to 2024, and you can see them free on our platform here.
It is also worth noting that we have found 1 warning sign for United Internet that you need to take into consideration.
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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.
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