Montana Aerospace AG (VTX:AERO) has just published its half-year results: This is what analysts think

Montana Aerospace AG (VTX:AERO) shareholders are likely to be a little disappointed as shares fell 4.2% to CHF18.40 in the week following the release of the latest interim results. Revenues came in at €365 million, with Montana Aerospace coming in around 8.4% below analyst expectations. Following the results release, analysts have updated their earnings model and it would be good to know if they think the company's outlook has changed a lot or if it's business as usual. We thought readers would find it interesting to see the analysts' latest (statutory) forecasts for next year following the results release.

Check out our latest analysis for Montana Aerospace

Following the latest results, the five analysts covering Montana Aerospace are now forecasting revenues of €1.50 billion in 2024. If this forecast is met, it would be a reasonable 2.6% increase in sales compared to the last 12 months. Montana Aerospace is also expected to become profitable, with statutory earnings of €0.97 per share. Ahead of this report, analysts had been modeling revenues of €1.70 billion and earnings per share (EPS) of €0.89 in 2024. It looks like there has been a major change in consensus opinion following the latest earnings report, as analysts have significantly cut their revenue forecasts and slightly raised their earnings estimates for next year.

There was no real change to the average price target of CHF24.63, and the lower revenue and higher earnings forecasts are not expected to materially affect the company's valuation over the long term. However, fixating on a single price target may be unwise, as the consensus target is effectively the average of analysts' price targets. As such, some investors like to look at the range of estimates to see if there are any diverging opinions on the company's valuation. There are some differing views on Montana Aerospace, with the most optimistic analyst estimating the value at CHF32.31 per share and the most pessimistic at CHF18.59 per share. This shows that there is still some divergence in estimates, but analysts do not seem to be completely divided on the stock as if it could be a hit or miss situation.

One way to put these forecasts into broader context is to look at them in comparison to past performance and to the performance of other companies in the same industry. We'd like to highlight that Montana Aerospace's revenue growth is expected to slow. The forecast annual growth rate of 5.2% through the end of 2024 is well below the historical growth of 25% per year over the past three years. For comparison, the other companies in this industry covered by analysts are forecast to grow their revenues by 11% per year. So it's pretty clear that while revenue growth is expected to slow, the industry as a whole is expected to grow faster than Montana Aerospace.

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The conclusion

The most important thing to note here is that analysts have been upgrading their earnings per share estimates, suggesting that optimism towards Montana Aerospace has increased significantly following these results. Unfortunately, they have also been downgrading their revenue estimates, and our data suggests underperformance relative to the wider industry. Still, earnings per share are more important to the company's intrinsic value. That being said, earnings are more important to the company's long-term value. There has been no real change in the consensus price target, suggesting that the company's intrinsic value has not changed much with the latest estimates.

With that in mind, we wouldn't jump to a conclusion about Montana Aerospace too quickly. Long-term earnings power is much more important than next year's earnings. We have estimates – from multiple Montana Aerospace analysts – out to 2026, and you can see them for free on our platform here.

It might also be worth checking whether Montana Aerospace's debt load is appropriate. You can do so using our debt analysis tools on the Simply Wall St platform here.

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This Simply Wall St article is of a general nature. We comment solely on historical data and analyst forecasts, using an unbiased methodology. Our articles do not constitute financial advice. It is not a recommendation to buy or sell any stock and does not take into account your objectives or financial situation. Our goal is to provide you with long-term analysis based on fundamental data. Note that our analysis may not take into account the latest price-sensitive company announcements or qualitative materials. Simply Wall St does not hold any of the stocks mentioned.