Results: Neste Oyj Beat Earnings Expectations And Analysts Now Have New Forecasts

A week ago, Neste Oyj (HEL:NESTE) came out with a strong set of third-quarter numbers that could potentially lead to a re-rate of the stock. It was a solid earnings report, with revenues and statutory earnings per share (EPS) both coming in strong. Revenues were 11% higher than the analysts had forecast, at €6.6b, while EPS were €1.35 beating analyst models by 28%. Following the result, the analysts have updated their earnings model, and it would be good to know whether they think there's been a strong change in the company's prospects, or if it's business as usual. We've gathered the most recent statutory forecasts to see whether the analysts have changed their earnings models, following these results.

AI is about to change healthcare. These 20 stocks are working on everything from early diagnostics to drug discovery. The best part - they are all under $10bn in marketcap - there is still time to get in early.

Following the latest results, Neste Oyj's 16 analysts are now forecasting revenues of €24.6b in 2027. This would be a notable 8.5% improvement in revenue compared to the last 12 months. Statutory earnings per share are expected to fall 10% to €2.86 in the same period. In the lead-up to this report, the analysts had been modelling revenues of €22.8b and earnings per share (EPS) of €2.83 in 2027. There doesn't appear to have been a major change in sentiment following the results, other than the slight bump in revenue estimates.

View our latest analysis for Neste Oyj

It may not be a surprise to see thatthe analysts have reconfirmed their price target of €35.42, implying that the uplift in revenue is not expected to greatly contribute to Neste Oyj's valuation in the near term. 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. There are some variant perceptions on Neste Oyj, with the most bullish analyst valuing it at €41.50 and the most bearish at €18.40 per share. Note the wide gap in analyst price targets? This implies to us that there is a fairly broad range of possible scenarios for the underlying business.

Of course, another way to look at these forecasts is to place them into context against the industry itself. The analysts are definitely expecting Neste Oyj's growth to accelerate, with the forecast 6.7% annualised growth to the end of 2027 ranking favourably alongside historical growth of 1.7% per annum over the past five years. Compare this with other companies in the same industry, which are forecast to see a revenue decline of 3.8% annually. It seems obvious that as part of the brighter growth outlook, Neste Oyj is expected to grow faster than the wider 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. Fortunately, they also upgraded their revenue estimates, and our data indicates it is expected to perform better 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 Neste Oyj going out to 2028, and you can see them free on our platform here.

Before you take the next step you should know about the 1 warning sign for Neste Oyj that we have uncovered.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.