It's been a pretty great week for L'Occitane International S.A. (HKG:973) shareholders, with its shares surging 14% to HK$25.85 in the week since its latest annual results. Revenues were €1.8b, approximately in line with whatthe analysts expected, although statutory earnings per share (EPS) crushed expectations, coming in at €0.16, an impressive 26% ahead of estimates. 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. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether the analysts have changed their mind on L'Occitane International after the latest results.

Check out our latest analysis for L'Occitane International

Following the latest results, L'Occitane International's nine analysts are now forecasting revenues of €2.05b in 2023. This would be a notable 15% improvement in sales compared to the last 12 months. Statutory earnings per share are predicted to rise 2.9% to €0.17. Before this earnings report, the analysts had been forecasting revenues of €2.08b and earnings per share (EPS) of €0.17 in 2023. So it's pretty clear that, although the analysts have updated their estimates, there's been no major change in expectations for the business following the latest results.

The analysts reconfirmed their price target of HK$35.32, showing that the business is executing well and in line with expectations. 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. There are some variant perceptions on L'Occitane International, with the most bullish analyst valuing it at HK$40.00 and the most bearish at HK$31.67 per share. So we wouldn't be assigning too much credibility to analyst price targets in this case, because there are clearly some widely different views on what kind of performance this business can generate. With this in mind, we wouldn't rely too heavily the consensus price target, as it is just an average and analysts clearly have some deeply divergent views on the business.

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. The analysts are definitely expecting L'Occitane International's growth to accelerate, with the forecast 15% annualised growth to the end of 2023 ranking favourably alongside historical growth of 5.7% per annum over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to grow their revenue at 9.6% per year. Factoring in the forecast acceleration in revenue, it's pretty clear that L'Occitane International is expected to grow much faster than its 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. Happily, there were no major changes to revenue forecasts, with the business still expected to grow faster than the wider industry. The consensus price target held steady at HK$35.32, with the latest estimates not enough to have an impact on their price targets.

With that in mind, we wouldn't be too quick to come to a conclusion on L'Occitane 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 L'Occitane International going out to 2025, and you can see them free on our platform here..

You can also see whether L'Occitane International is carrying too much debt, and whether its balance sheet is healthy, for free on our platform here.

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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.