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National Fuel Gas Company Just Recorded A 9.0% EPS Beat: Here's What Analysts Are Forecasting Next

As you might know, National Fuel Gas Company (NYSE:NFG) recently reported its first-quarter numbers. Revenues US$525m fell badly short of expectations, missing analyst targets by 21%. Statutory earnings per share (EPS) of US$1.44 performed better, coming in 9.0% above analyst models. 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.

Check out our latest analysis for National Fuel Gas

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After the latest results, the four analysts covering National Fuel Gas are now predicting revenues of US$2.31b in 2024. If met, this would reflect a notable 13% improvement in revenue compared to the last 12 months. Per-share earnings are expected to increase 3.1% to US$4.93. Yet prior to the latest earnings, the analysts had been anticipated revenues of US$2.43b and earnings per share (EPS) of US$4.74 in 2024. So it's pretty clear that while sentiment around revenues has declined following the latest results, the analysts are now more bullish on the company's earnings power.

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The consensus has made no major changes to the price target of US$58.25, suggesting the forecast improvement in earnings is expected to offset the decline in revenues next year. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. Currently, the most bullish analyst values National Fuel Gas at US$67.00 per share, while the most bearish prices it at US$54.00. With such a narrow range of valuations, the analysts apparently share similar views on what they think the business is worth.

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 National Fuel Gas' rate of growth is expected to accelerate meaningfully, with the forecast 18% annualised revenue growth to the end of 2024 noticeably faster than its historical growth of 7.9% p.a. over the past five years. Compare this with other companies in the same industry, which are forecast to grow their revenue 7.1% annually. It seems obvious that, while the growth outlook is brighter than the recent past, the analysts also expect National Fuel Gas to grow faster than the wider industry.

The Bottom Line

The most important thing here is that the analysts upgraded their earnings per share estimates, suggesting that there has been a clear increase in optimism towards National Fuel Gas following these results. They also downgraded National Fuel Gas' revenue estimates, but industry data suggests that it is expected to grow faster than the wider industry. Yet - earnings are more important to the intrinsic value of the business. 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.

With that in mind, we wouldn't be too quick to come to a conclusion on National Fuel Gas. Long-term earnings power is much more important than next year's profits. We have forecasts for National Fuel Gas going out to 2026, and you can see them free on our platform here.

Even so, be aware that National Fuel Gas is showing 2 warning signs in our investment analysis , you should know about...

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.