It's been a good week for Vista Group International Limited (NZSE:VGL) shareholders, because the company has just released its latest yearly results, and the shares gained 5.0% to NZ$1.46. Revenues of NZ$135m beat expectations by a respectable 4.3%, although statutory losses per share increased. Vista Group International lost NZ$0.09, which was 50% more than what the analysts had included in their models. 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 thought readers would find it interesting to see the analysts latest (statutory) post-earnings forecasts for next year.

See our latest analysis for Vista Group International  earnings-and-revenue-growth

Taking into account the latest results, the current consensus from Vista Group International's three analysts is for revenues of NZ$143.9m in 2023, which would reflect a reasonable 6.5% increase on its sales over the past 12 months. Losses are predicted to fall substantially, shrinking 63% to NZ$0.034. Before this earnings announcement, the analysts had been modelling revenues of NZ$138.4m and losses of NZ$0.03 per share in 2023. While this year's revenue estimates increased, there was also a noticeable increase in loss per share expectations, suggesting the consensus has a bit of a mixed view on the stock.

It will come as no surprise that expanding losses caused the consensus price target to fall 5.7% to NZ$1.81with the analysts implicitly ranking ongoing losses as a greater concern than growing revenues. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. There are some variant perceptions on Vista Group International, with the most bullish analyst valuing it at NZ$1.95 and the most bearish at NZ$1.57 per share. Still, with such a tight range of estimates, it suggeststhe analysts have a pretty good idea of what they think the company is worth.



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. One thing stands out from these estimates, which is that Vista Group International is forecast to grow faster in the future than it has in the past, with revenues expected to display 6.5% annualised growth until the end of 2023. If achieved, this would be a much better result than the 2.8% annual decline over the past five years. Compare this against analyst estimates for the broader industry, which suggest that (in aggregate) industry revenues are expected to grow 18% annually for the foreseeable future. Although Vista Group International's revenues are expected to improve, it seems that the analysts are still bearish on the business, forecasting it to grow slower than the broader industry.

The Bottom Line

The most important thing to take away is that the analysts increased their loss per share estimates for next year. Fortunately, they also upgraded their revenue estimates, although our data indicates sales are expected to perform worse than the wider industry. Furthermore, the analysts also cut their price targets, suggesting that the latest news has led to greater pessimism about the intrinsic value of the business.

With that in mind, we wouldn't be too quick to come to a conclusion on Vista Group International. Long-term earnings power is much more important than next year's profits. At Simply Wall St, we have a full range of analyst estimates for Vista Group International 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 Vista Group International 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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