Earnings Miss: Outokumpu Oyj Missed EPS By 15% And Analysts Are Revising Their Forecasts

Shareholders in Outokumpu Oyj (HEL:OUT1V) had a terrible week, as shares crashed 20% to €3.67 in the week since its latest third-quarter results. It was not a great result overall. While revenues of €1.6b were in line with analyst predictions, earnings were less than expected, missing statutory estimates by 15% to hit €0.05 per share. 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 thought readers would find it interesting to see the analysts latest (statutory) post-earnings forecasts for next year.

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Taking into account the latest results, the most recent consensus for Outokumpu Oyj from twelve analysts is for revenues of €6.58b in 2027. If met, it would imply a notable 14% increase on its revenue over the past 12 months. Outokumpu Oyj is also expected to turn profitable, with statutory earnings of €0.42 per share. Yet prior to the latest earnings, the analysts had been anticipated revenues of €6.71b and earnings per share (EPS) of €0.49 in 2027. So there's definitely been a decline in sentiment after the latest results, noting the real cut to new EPS forecasts.

View our latest analysis for Outokumpu Oyj

It might be a surprise to learn that the consensus price target fell 14% to €5.02, with the analysts clearly linking lower forecast earnings to the performance of the stock price. 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 Outokumpu Oyj at €5.80 per share, while the most bearish prices it at €3.40. Analysts definitely have varying views on the business, but the spread of estimates is not wide enough in our view to suggest that extreme outcomes could await Outokumpu Oyj shareholders.

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. One thing stands out from these estimates, which is that Outokumpu Oyj is forecast to grow faster in the future than it has in the past, with revenues expected to display 11% annualised growth until the end of 2027. If achieved, this would be a much better result than the 10% annual decline over the past five years. Compare this against analyst estimates for the broader industry, which suggest that (in aggregate) industry revenues are expected to grow 2.9% annually. So it looks like Outokumpu Oyj is expected to grow faster than its competitors, at least for a while.

The Bottom Line

The most important thing to take away is that the analysts downgraded their earnings per share estimates, showing that there has been a clear decline in sentiment following these results. Happily, there were no major changes to revenue forecasts, with the business still expected to grow faster than the wider industry. The consensus price target fell measurably, with the analysts seemingly not reassured by the latest results, leading to a lower estimate of Outokumpu Oyj's future valuation.

Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. We have estimates - from multiple Outokumpu Oyj analysts - 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 Outokumpu Oyj you should be aware of, and 1 of them is significant.

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