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Need To Know: Analysts Are Much More Bullish On Crescent Point Energy Corp. (TSE:CPG) Revenues

Crescent Point Energy Corp. (TSE:CPG) shareholders will have a reason to smile today, with the analysts making substantial upgrades to this year's statutory forecasts. The revenue forecast for this year has experienced a facelift, with the analysts now much more optimistic on its sales pipeline.

After this upgrade, Crescent Point Energy's three analysts are now forecasting revenues of CA$4.2b in 2023. This would be a modest 4.3% improvement in sales compared to the last 12 months. Statutory earnings per share are supposed to crater 31% to CA$1.87 in the same period. Previously, the analysts had been modelling revenues of CA$3.7b and earnings per share (EPS) of CA$1.83 in 2023. The most recent forecasts are noticeably more optimistic, with a solid increase in revenue estimates and a lift to earnings per share as well.

See our latest analysis for Crescent Point Energy

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Although the analysts have upgraded their earnings estimates, there was no change to the consensus price target of CA$13.79, suggesting that the forecast performance does not have a long term impact on the company's valuation. 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 Crescent Point Energy, with the most bullish analyst valuing it at CA$16.00 and the most bearish at CA$12.50 per share. Still, with such a tight range of estimates, it suggests the analysts have a pretty good idea of what they think the company is worth.

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Of course, another way to look at these forecasts is to place them into context against the industry itself. It's clear from the latest estimates that Crescent Point Energy's rate of growth is expected to accelerate meaningfully, with the forecast 4.3% annualised revenue growth to the end of 2023 noticeably faster than its historical growth of 0.6% p.a. over the past five years. Compare this with other companies in the same industry, which are forecast to see a revenue decline of 1.4% annually. So it's clear with the acceleration in growth, Crescent Point Energy is expected to grow meaningfully faster than the wider industry.

The Bottom Line

The biggest takeaway for us from these new estimates is that analysts upgraded their earnings per share estimates, with improved earnings power expected for this year. Fortunately, they also upgraded their revenue estimates, and our data indicates sales are expected to perform better than the wider market. Seeing the dramatic upgrade to this year's forecasts, it might be time to take another look at Crescent Point Energy.

Analysts are definitely bullish on Crescent Point Energy, but no company is perfect. Indeed, you should know that there are several potential concerns to be aware of, including its declining profit margins. You can learn more, and discover the 2 other flags we've identified, for free on our platform here.

Another way to search for interesting companies that could be reaching an inflection point is to track whether management are buying or selling, with our free list of growing companies that insiders are buying.

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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