it’s been a good week for TT Electronics plc (LON: TTG), as the company just released its latest interim results and shares are up 4.7% to Â£ 2.79. This is an impeccable result, with revenues of Â£ 236million ahead of expectations 4.6% and statutory earnings per share of Â£ 0.008, according to analysts’ estimates. This is an important time for investors, as they can follow a company’s performance in its report, look at experts’ forecasts for next year, and see if there has been a change in the company’s expectations. company. So we’ve collected the latest post-earnings statutory consensus estimates to see what might be in store for next year.
See our latest review for TT Electronics
Based on the latest results, the current consensus of seven TT Electronics analysts is forecasting revenue of Â£ 479.8million in 2021, which would reflect an acceptable 4.9% increase in sales over the past 12 last months. Earnings per share are expected to jump 26% to UK Â£ 0.074. Before this report was written, analysts had modeled earnings of Â£ 464.4million and earnings per share (EPS) of UK Â£ 0.085 in 2021. As next year’s earnings estimates have risen, there has also been a substantial drop in BPA expectations. , suggesting that the consensus has a mixed view of these results.
There has been no major change to the UK Â£ 2.94 price target, suggesting that the impact of forecast higher sales and lower profits will not result in a significant change in the price. business valuation. There is another way to think about price targets, however, and that is to look at the range of price targets offered by analysts, as a wide range of estimates might suggest a different view of the possible outcomes for the market. company. TT Electronics’ most bullish analyst has a price target of Â£ 3.50 per share, while the most pessimistic puts it at Â£ 2.25. Analysts certainly have differing views on the company, but the variation in estimates is not wide enough in our view to suggest that extreme results may lie ahead for TT Electronics shareholders.
These estimates are interesting, but it may be useful to paint a few broader strokes when comparing the forecasts, both to TT Electronics’ past performance and to that of its peers in the same industry. It is clear from the latest estimates that TT Electronics’ growth rate is expected to accelerate significantly, with an annualized revenue growth forecast of 10% by the end of 2021 to be significantly faster than its historical growth. by 5.9% per year over the past five years. In contrast, our data suggests that other companies (with analyst coverage) in a similar industry are expected to increase their revenues by 7.6% per year. Considering the expected acceleration in revenues, it’s pretty clear that TT Electronics is expected to grow much faster than its industry.
The bottom line
The biggest concern is that analysts have lowered their earnings per share estimates, suggesting headwinds could be brewing for TT Electronics. Fortunately, they have also improved their revenue estimates and predict that revenue will grow faster than the industry as a whole. The consensus price target held steady at Â£ 2.94 as the latest estimates were not sufficient to impact their price targets.
With that in mind, we wouldn’t be too quick to draw a conclusion on TT Electronics. Long-term earning power is much more important than next year’s profits. At Simply Wall St, we have a full range of analyst estimates for TT Electronics through 2023, and you can view them for free on our platform here.
Nevertheless, be aware that TT Electronics shows 2 warning signs in our investment analysis , and 1 of them concerns …
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