Analyst Forecasts For HelloFresh SE (ETR:HFG) Are Surging Higher
HelloFresh SE (ETR:HFG) shareholders will have a reason to smile today, with the analysts making substantial upgrades to this year's statutory forecasts. The consensus statutory numbers for both revenue and earnings per share (EPS) increased, with their view clearly much more bullish on the company's business prospects. HelloFresh has also found favour with investors, with the stock up a remarkable 18% to €30.60 over the past week. It will be interesting to see if today's upgrade is enough to propel the stock even higher.
After the upgrade, the six analysts covering HelloFresh are now predicting revenues of €2.6b in 2020. If met, this would reflect a major 43% improvement in sales compared to the last 12 months. Losses are expected to turn into profits real soon, with the analysts forecasting €0.73 in per-share earnings €0.73. Before this latest update, the analysts had been forecasting revenues of €2.3b and earnings per share (EPS) of €0.55 in 2020. So we can see there's been a pretty clear increase in analyst sentiment in recent times, with both revenues and earnings per share receiving a decent lift in the latest estimates.
See our latest analysis for HelloFresh
It will come as no surprise to learn that the analysts have increased their price target for HelloFresh 15% to €29.93 on the back of these upgrades. That's not the only conclusion we can draw from this data however, as some investors also like to consider the spread in estimates when evaluating analyst price targets. The most optimistic HelloFresh analyst has a price target of €35.00 per share, while the most pessimistic values it at €26.00. 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.
One way to get more context on these forecasts is to look at how they compare to both past performance, and how other companies in the same industry are performing. Next year brings more of the same, according to the analysts, with revenue forecast to grow 43%, in line with its 38% annual growth over the past five years. Compare this with the wider industry, which analyst estimates (in aggregate) suggest will see revenues grow 23% next year. So it's pretty clear that HelloFresh is forecast to grow substantially faster than its industry.
The Bottom Line
The biggest takeaway for us from these new estimates is that analysts upgraded their earnings per share estimates, with improved earnings power expected for this year. They also upgraded their revenue estimates for this year, and sales are expected to grow faster than the wider market. With a serious upgrade to expectations and a rising price target, it might be time to take another look at HelloFresh.
Even so, the longer term trajectory of the business is much more important for the value creation of shareholders. At Simply Wall St, we have a full range of analyst estimates for HelloFresh going out to 2023, and you can see them free on our platform here..
Of course, seeing company management invest large sums of money in a stock can be just as useful as knowing whether analysts are upgrading their estimates. So you may also wish to search this free list of stocks that insiders are buying.
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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