It's been a mediocre week for Aena S.M.E., S.A. (BME:AENA) shareholders, with the stock dropping 10% to €151 in the week since its latest annual results. It was a credible result overall, with revenues of €4.4b and statutory earnings per share of €9.61 both in line with analyst estimates, showing that Aena S.M.E is executing in line with expectations. 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 analysts' latest (statutory) post-earnings forecasts for next year.

View our latest analysis for Aena S.M.E

Following the latest results, Aena S.M.E's twelve analysts are now forecasting revenues of €4.72b in 2020. This would be a satisfactory 6.0% improvement in sales compared to the last 12 months. Statutory earnings per share are expected to rise 8.0% to €10.38. Before this earnings report, analysts had been forecasting revenues of €4.60b and earnings per share (EPS) of €9.60 in 2020. So there seems to have been a moderate uplift in analyst sentiment following the latest results, given the upgrades to both revenue and earnings per share forecasts for next year.

Although analysts have upgraded their earnings estimates, there was no change to the consensus price target of €166, suggesting that the forecast performance does not have a long term impact on the company's valuation 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. There are some variant perceptions on Aena S.M.E, with the most bullish analyst valuing it at €220 and the most bearish at €140 per share. 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.

It can be useful to take a broader overview by seeing how analyst forecasts compare, both to the Aena S.M.E's past performance and to peers in the same market. We can infer from the latest estimates that analysts are expecting a continuation of Aena S.M.E's historical trends, as next year's forecast 6.0% revenue growth is roughly in line with 6.9% annual revenue growth over the past five years. Compare this with the wider market, which analyst estimates (in aggregate) suggest will see revenues grow 2.4% next year. So although Aena S.M.E is expected to maintain its revenue growth rate, it's definitely expected to grow faster than the wider market.

The Bottom Line

The biggest takeaway for us from these new estimates is that the consensus upgraded its earnings per share estimates, showing a clear improvement in sentiment around Aena S.M.E's earnings potential next year. Pleasantly, analysts also upgraded their revenue estimates, and their forecasts suggest the business is expected to grow faster than the wider market. 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.

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 Aena S.M.E going out to 2023, and you can see them free on our platform here..

It might also be worth considering whether Aena S.M.E's debt load is appropriate, using our debt analysis tools on the Simply Wall St platform, here.

If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.com. 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. Simply Wall St has no position in the stocks mentioned.

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