Earnings Beat: Here's What Ninety One Group (LON:N91) Analysts Are Forecasting For This Year

Simply Wall St
·3 min read

Ninety One Group (LON:N91) just released its latest full-year results and things are looking bullish. The company beat expectations with revenues of UK£625m arriving 5.3% ahead of forecasts. Statutory earnings per share (EPS) were UK£0.17, 6.1% ahead of estimates. 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. We've gathered the most recent statutory forecasts to see whether the analysts have changed their earnings models, following these results.

View our latest analysis for Ninety One Group

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Taking into account the latest results, Ninety One Group's five analysts currently expect revenues in 2022 to be UK£634.8m, approximately in line with the last 12 months. Statutory earnings per share are predicted to accumulate 2.4% to UK£0.17. In the lead-up to this report, the analysts had been modelling revenues of UK£633.5m and earnings per share (EPS) of UK£0.17 in 2022. So it's pretty clear that, although the analysts have updated their estimates, there's been no major change in expectations for the business following the latest results.

The analysts reconfirmed their price target of UK£2.59, showing that the business is executing well and in line with expectations. There's another way to think about price targets though, and that's to look at the range of price targets put forward by analysts, because a wide range of estimates could suggest a diverse view on possible outcomes for the business. The most optimistic Ninety One Group analyst has a price target of UK£2.66 per share, while the most pessimistic values it at UK£2.45. The narrow spread of estimates could suggest that the business' future is relatively easy to value, or thatthe analysts have a strong view on its prospects.

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 Ninety One Group's revenue growth will slow down substantially, with revenues to the end of 2022 expected to display 1.5% growth on an annualised basis. This is compared to a historical growth rate of 7.4% over the past three years. By way of comparison, the other companies in this industry with analyst coverage are forecast to grow their revenue at 2.6% per year. Factoring in the forecast slowdown in growth, it seems obvious that Ninety One Group is also expected to grow slower than other industry participants.

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. On the plus side, there were no major changes to revenue estimates; although forecasts imply revenues will perform worse 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.

Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. At Simply Wall St, we have a full range of analyst estimates for Ninety One Group going out to 2024, 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 Ninety One Group , and understanding this should be part of your investment process.

This article by Simply Wall St is general in nature. 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.

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

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