Stora Enso Oyj Reported A Surprise Loss, And Analysts Have Updated Their Forecasts
Shareholders might have noticed that Stora Enso Oyj (HEL:STERV) filed its second-quarter result this time last week. The early response was not positive, with shares down 4.0% to €9.38 in the past week. Revenues came in at €2.4b, in line with estimates, while Stora Enso Oyj reported a statutory loss of €0.03 per share, well short of prior analyst forecasts for a profit. The analysts typically update their forecasts at each earnings report, and we can judge from their estimates whether their view of the company has changed or if there are any new concerns to be aware of. With this in mind, we've gathered the latest statutory forecasts to see what the analysts are expecting for next year.
Following last week's earnings report, Stora Enso Oyj's 14 analysts are forecasting 2026 revenues to be €9.41b, approximately in line with the last 12 months. Statutory earnings per share are expected to plunge 57% to €0.31 in the same period. In the lead-up to this report, the analysts had been modelling revenues of €9.45b and earnings per share (EPS) of €0.53 in 2026. So there's definitely been a decline in sentiment after the latest results, noting the large cut to new EPS forecasts.
Check out our latest analysis for Stora Enso Oyj
It might be a surprise to learn that the consensus price target was broadly unchanged at €11.22, with the analysts clearly implying that the forecast decline in earnings is not expected to have much of an impact on valuation. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. The most optimistic Stora Enso Oyj analyst has a price target of €13.50 per share, while the most pessimistic values it at €8.00. There are definitely some different views on the stock, but the range of estimates is not wide enough as to imply that the situation is unforecastable, in our view.
These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Stora Enso Oyj's past performance and to peers in the same industry. For example, we noticed that Stora Enso Oyj's rate of growth is expected to accelerate meaningfully, with revenues forecast to exhibit 2.1% growth to the end of 2026 on an annualised basis. That is well above its historical decline of 3.3% a year over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to see their revenue grow 4.2% per year. So although Stora Enso Oyj's revenue growth is expected to improve, it is still expected to grow slower than the industry.
The Bottom Line
The biggest concern is that the analysts reduced their earnings per share estimates, suggesting business headwinds could lay ahead for Stora Enso Oyj. On the plus side, there were no major changes to revenue estimates; although forecasts imply they will perform worse than the wider industry. The consensus price target held steady at €11.22, with the latest estimates not enough to have an impact on their price targets.
With that in mind, we wouldn't be too quick to come to a conclusion on Stora Enso Oyj. Long-term earnings power is much more important than next year's profits. We have forecasts for Stora Enso Oyj going out to 2028, and you can see them free on our platform here.
Plus, you should also learn about the 2 warning signs we've spotted with Stora Enso Oyj .
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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.