Earnings Beat: Borregaard ASA Just Beat Analyst Forecasts, And Analysts Have Been Updating Their Models
Investors in Borregaard ASA (OB:BRG) had a good week, as its shares rose 9.1% to close at kr154 following the release of its third-quarter results. Revenues of kr1.9b fell slightly short of expectations, but earnings were a definite bright spot, with statutory per-share profits of kr2.96 an impressive 35% ahead of estimates. 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. With this in mind, we've gathered the latest statutory forecasts to see what the analysts are expecting for next year.
Following the latest results, Borregaard's five analysts are now forecasting revenues of kr8.17b in 2027. This would be a satisfactory 4.1% improvement in revenue compared to the last 12 months. Statutory earnings per share are predicted to leap 278% to kr10.19. Before this earnings report, the analysts had been forecasting revenues of kr8.25b and earnings per share (EPS) of kr9.99 in 2027. The analysts seems to have become more bullish on the business, judging by their new earnings per share estimates.
See our latest analysis for Borregaard
The consensus price target was unchanged at kr176, implying that the improved earnings outlook is not expected to have a long term impact on value creation for shareholders. The consensus price target is just an average of individual analyst targets, so - it could be handy to see how wide the range of underlying estimates is. Currently, the most bullish analyst values Borregaard at kr190 per share, while the most bearish prices it at kr148. This is a very narrow spread of estimates, implying either that Borregaard is an easy company to value, or - more likely - the analysts are relying heavily on some key assumptions.
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 highlight that Borregaard's revenue growth is expected to slow, with the forecast 3.3% annualised growth rate until the end of 2027 being well below the historical 5.6% p.a. growth over the last five years. Juxtapose this against the other companies in the industry with analyst coverage, which are forecast to grow their revenues (in aggregate) 0.8% per year. Even after the forecast slowdown in growth, it seems obvious that Borregaard is also expected to grow faster than the wider industry.
The Bottom Line
The biggest takeaway for us is the consensus earnings per share upgrade, which suggests a clear improvement in sentiment around Borregaard's earnings potential next year. 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. 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.
With that said, the long-term trajectory of the company's earnings is a lot more important than next year. We have forecasts for Borregaard going out to 2028, and you can see them free on our platform here.
It is also worth noting that we have found 1 warning sign for Borregaard that you need to take into consideration.
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