Earnings Beat: adidas AG Just Beat Analyst Forecasts, And Analysts Have Been Updating Their Models
Investors in adidas AG (ETR:ADS) had a good week, as its shares rose 7.0% to close at €169 following the release of its quarterly results. It looks like a credible result overall - although revenues of €7.3b were what the analysts expected, adidas surprised by delivering a (statutory) profit of €4.08 per share, an impressive 21% above what was forecast. 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.
Taking into account the latest results, the consensus forecast from adidas' 28 analysts is for revenues of €29.2b in 2027. This reflects a meaningful 9.6% improvement in revenue compared to the last 12 months. Statutory earnings per share are predicted to surge 26% to €11.76. Before this earnings report, the analysts had been forecasting revenues of €29.0b and earnings per share (EPS) of €11.64 in 2027. The consensus analysts don't seem to have seen anything in these results that would have changed their view on the business, given there's been no major change to their estimates.
See our latest analysis for adidas
The analysts reconfirmed their price target of €200, showing that the business is executing well and in line with expectations. 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 adidas analyst has a price target of €245 per share, while the most pessimistic values it at €160. As you can see, analysts are not all in agreement on the stock's future, but the range of estimates is still reasonably narrow, which could suggest that the outcome is not totally unpredictable.
Of course, another way to look at these forecasts is to place them into context against the industry itself. The analysts are definitely expecting adidas' growth to accelerate, with the forecast 7.6% annualised growth to the end of 2027 ranking favourably alongside historical growth of 4.2% per annum over the past five years. Other similar companies in the industry (with analyst coverage) are also forecast to grow their revenue at 6.1% per year. Factoring in the forecast acceleration in revenue, it's pretty clear that adidas is expected to grow at about the same rate as the wider industry.
The Bottom Line
The most obvious conclusion is that there's been no major change in the business' prospects in recent times, with the analysts holding their earnings forecasts steady, in line with previous estimates. Happily, there were no real changes to revenue forecasts, with the business still expected to grow in line with the overall industry. The consensus price target held steady at €200, with the latest estimates not enough to have an impact on their price targets.
With that said, the long-term trajectory of the company's earnings is a lot more important than next year. At Simply Wall St, we have a full range of analyst estimates for adidas going out to 2028, and you can see them free on our platform here..
That said, it's still necessary to consider the ever-present spectre of investment risk. We've identified 1 warning sign with adidas , and understanding it should be part of your investment process.
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