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TUI AG Full-Year Results: Here's What Analysts Are Forecasting For Next Year

TUI AG (ETR:TUI1) last week reported its latest annual results, which makes it a good time for investors to dive in and see if the business is performing in line with expectations. TUI missed revenue estimates by 2.3%, with sales of €19b, although earnings per share (EPS) of €0.71 beat expectations, coming in 3.8% ahead of analyst estimates. Earnings are an important time for investors, as they can track a company's performance, look at what top analysts are forecasting for next year, and see if there's been a change in sentiment towards the company. Readers will be glad to know we've aggregated the latest forecasts to see whether analysts have changed their mind on TUI after the latest results.

View our latest analysis for TUI

XTRA:TUI1 Past and Future Earnings, December 15th 2019
XTRA:TUI1 Past and Future Earnings, December 15th 2019

Taking into account the latest results, the current consensus from TUI's 16 analysts is for revenues of €20.2b in 2020, which would reflect an okay 6.8% increase on its sales over the past 12 months. Earnings per share are expected to surge 22% to €0.87. Before this earnings report, analysts had been forecasting revenues of €20.2b and earnings per share (EPS) of €1.04 in 2020. So there's definitely been a decline in analyst sentiment after the latest results, noting the real cut to new EPS forecasts.

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It might be a surprise to learn that the consensus price target was broadly unchanged at €10.74, with analysts clearly implying that the forecast decline in earnings is not expected to have much of an impact on valuation. The consensus price target just an average of individual analyst targets, so - considering that the price target changed, it would be handy to see how wide the range of underlying estimates is. Currently, the most bullish analyst values TUI at €12.50 per share, while the most bearish prices it at €6.90. 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.

It can be useful to take a broader overview by seeing how analyst forecasts compare, both to the TUI's past performance and to peers in the same market. It's clear from the latest estimates that TUI's rate of growth is expected to accelerate meaningfully, with forecast 6.8% revenue growth noticeably faster than its historical growth of 1.6%p.a. over the past five years. Compare this with other companies in the same market, which are forecast to grow their revenue 3.0% next year. It seems obvious that, while the growth outlook is brighter than the recent past, analysts also expect TUI to grow faster than the wider market.

The Bottom Line

The most important thing to take away is that analysts downgraded their earnings per share estimates, showing that there has been a clear decline in sentiment following these results. Fortunately, analysts also reconfirmed their revenue estimates, suggesting sales are tracking in line with expectations - and our data does suggest that TUI's revenues are 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.

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 TUI going out to 2024, and you can see them free on our platform here..

You can also see our analysis of TUI's Board and CEO remuneration and experience, and whether company insiders have been buying stock.

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.

We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Thank you for reading.