Yahoo Finance Analysts Are Updating Their Haleon plc (LON:HLN) Estimates After Its Half-Yearly Results
Investors in Haleon plc (LON:HLN) had a good week, as its shares rose 4.3% to close at UK£3.68 following the release of its interim results. It was a credible result overall, with revenues of UK£5.7b and statutory earnings per share of UK£0.033 both in line with analyst estimates, showing that Haleon is executing in line with 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.
View our latest analysis for Haleon
Following last week's earnings report, Haleon's 16 analysts are forecasting 2024 revenues to be UK£11.4b, approximately in line with the last 12 months. Statutory earnings per share are predicted to jump 31% to UK£0.16. In the lead-up to this report, the analysts had been modelling revenues of UK£11.4b and earnings per share (EPS) of UK£0.16 in 2024. The consensus analysts don't seem to have seen anything in these results that would have changed their view on the business, given there's been no major change to their estimates.
It will come as no surprise then, to learn that the consensus price target is largely unchanged at UK£3.75. 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 Haleon analyst has a price target of UK£4.10 per share, while the most pessimistic values it at UK£3.00. This is a very narrow spread of estimates, implying either that Haleon is an easy company to value, or - more likely - the analysts are relying heavily on some key assumptions.
These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Haleon's past performance and to peers in the same industry. For example, we noticed that Haleon's rate of growth is expected to accelerate meaningfully, with revenues forecast to exhibit 2.2% growth to the end of 2024 on an annualised basis. That is well above its historical decline of 1.3% a year over the past year. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to see their revenue grow 3.3% per year. Although Haleon'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 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. Fortunately, the analysts also reconfirmed their revenue estimates, suggesting that it's tracking in line with expectations. Although our data does suggest that Haleon's revenue is expected to 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.
Following on from that line of thought, we think that the long-term prospects of the business are much more relevant than next year's earnings. We have estimates - from multiple Haleon analysts - going out to 2026, and you can see them free on our platform here.
You still need to take note of risks, for example - Haleon has 1 warning sign we think you should be aware of.
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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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