Results: Billerud AB (publ) Exceeded Expectations And The Consensus Has Updated Its Estimates

A week ago, Billerud AB (publ) (STO:BILL) came out with a strong set of third-quarter numbers that could potentially lead to a re-rate of the stock. The company beat forecasts, with revenue of kr10b, some 2.1% above estimates, and statutory earnings per share (EPS) coming in at kr0.85, 50% ahead of expectations. Earnings are an important time for investors, as they can track a company's performance, look at what the analysts are forecasting for next year, and see if there's been a change in sentiment towards the company. We've gathered the most recent statutory forecasts to see whether the analysts have changed their earnings models, following these results.

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After the latest results, the seven analysts covering Billerud are now predicting revenues of kr41.3b in 2027. If met, this would reflect a credible 5.3% improvement in revenue compared to the last 12 months. Statutory earnings per share are predicted to surge 487% to kr5.50. In the lead-up to this report, the analysts had been modelling revenues of kr40.9b and earnings per share (EPS) of kr5.05 in 2027. So the consensus seems to have become somewhat more optimistic on Billerud's earnings potential following these results.

View our latest analysis for Billerud

The consensus price target rose 5.2% to kr94.86, suggesting that higher earnings estimates flow through to the stock's valuation as well. Fixating on a single price target can be unwise though, since the consensus target is effectively the average of analyst price targets. As a result, some investors like to look at the range of estimates to see if there are any diverging opinions on the company's valuation. The most optimistic Billerud analyst has a price target of kr100.00 per share, while the most pessimistic values it at kr88.00. With such a narrow range of valuations, the analysts apparently share similar views on what they think the business is worth.

Of course, another way to look at these forecasts is to place them into context against the industry itself. It's pretty clear that there is an expectation that Billerud's revenue growth will slow down substantially, with revenues to the end of 2027 expected to display 4.3% 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) 4.2% annually. So it's pretty clear that, while Billerud's revenue growth is expected to slow, it's expected to grow roughly in line with the industry.

The Bottom Line

The most important thing here is that the analysts upgraded their earnings per share estimates, suggesting that there has been a clear increase in optimism towards Billerud following these results. They also reconfirmed their revenue estimates, with the company predicted to grow at about the same rate as the wider 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 in mind, we wouldn't be too quick to come to a conclusion on Billerud. Long-term earnings power is much more important than next year's profits. At Simply Wall St, we have a full range of analyst estimates for Billerud going out to 2028, and you can see them free on our platform here..

You should always think about risks though. Case in point, we've spotted 2 warning signs for Billerud you should be aware of, and 1 of them is a bit unpleasant.

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