It's been a good week for Wolters Kluwer N.V. (AMS:WKL) shareholders, because the company has just released its latest full-year results, and the shares gained 6.9% to €111. It looks like a credible result overall - although revenues of €5.5b were in line with what the analysts predicted, Wolters Kluwer surprised by delivering a statutory profit of €4.01 per share, a notable 15% above expectations. 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 thought readers would find it interesting to see the analysts latest (statutory) post-earnings forecasts for next year.

See our latest analysis for Wolters Kluwer

Following the latest results, Wolters Kluwer's eleven analysts are now forecasting revenues of €5.65b in 2023. This would be a reasonable 3.7% improvement in sales compared to the last 12 months. Statutory per-share earnings are expected to be €4.07, roughly flat on the last 12 months. In the lead-up to this report, the analysts had been modelling revenues of €5.52b and earnings per share (EPS) of €3.67 in 2023. There's been a pretty noticeable increase in sentiment, with the analysts upgrading revenues and making a solid gain to earnings per share in particular.

Althoughthe analysts have upgraded their earnings estimates, there was no change to the consensus price target of €112, suggesting that the forecast performance does not have a long term impact on the company's 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 Wolters Kluwer analyst has a price target of €135 per share, while the most pessimistic values it at €43.00. 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.

Taking a look at the bigger picture now, one of the ways we can understand these forecasts is to see how they compare to both past performance and industry growth estimates. The period to the end of 2023 brings more of the same, according to the analysts, with revenue forecast to display 3.7% growth on an annualised basis. That is in line with its 4.1% annual growth over the past five years. Compare this with the broader industry, which analyst estimates (in aggregate) suggest will see revenues grow 3.9% annually. It's clear that while Wolters Kluwer's revenue growth is expected to continue on its current trajectory, it's only expected to grow in line with the industry itself.

The Bottom Line

The most important thing here is that the analysts upgraded their earnings per share estimates, suggesting that there has been a clear increase in optimism towards Wolters Kluwer following these results. There was also an upgrade to revenue estimates, although as we saw earlier, forecast growth is only expected to be about the same as 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. We have forecasts for Wolters Kluwer going out to 2025, and you can see them free on our platform here.

Don't forget that there may still be risks. For instance, we've identified 1 warning sign for Wolters Kluwer that you should be aware of.

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

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.

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