Shareholders will be ecstatic, with their stake up 30% over the past week following CES Energy Solutions Corp.'s (TSE:CEU) latest third-quarter results. Sales hit CA$166m in line with forecasts, although the company reported a statutory loss per share of CA$0.05 that was somewhat smaller than the analysts expected. Earnings are an important time for investors, as they can track a company's performance, look at what the analysts are forecasting for next year, and see if there's been a change in sentiment towards the company. So we collected the latest post-earnings statutory consensus estimates to see what could be in store for next year.
Check out our latest analysis for CES Energy Solutions
Following the recent earnings report, the consensus from eleven analysts covering CES Energy Solutions is for revenues of CA$859.7m in 2021, implying a not inconsiderable 13% decline in sales compared to the last 12 months. The loss per share is expected to greatly reduce in the near future, narrowing 92% to CA$0.073. Before this earnings announcement, the analysts had been modelling revenues of CA$855.2m and losses of CA$0.099 per share in 2021. Although the revenue estimates have not really changed CES Energy Solutions'future looks a little different to the past, with a the loss per share forecasts in particular.
There's been no major changes to the consensus price target of CA$1.51, suggesting that reduced loss estimates are not enough to have a long-term positive impact on the stock's valuation. 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 CES Energy Solutions, with the most bullish analyst valuing it at CA$2.50 and the most bearish at CA$1.00 per share. This is a fairly broad spread of estimates, suggesting that analysts are forecasting a wide range of possible outcomes for the business.
Looking at the bigger picture now, one of the ways we can make sense of these forecasts is to see how they measure up against both past performance and industry growth estimates. We would highlight that sales are expected to reverse, with the forecast 13% revenue decline a notable change from historical growth of 15% over the last five years. By contrast, our data suggests that other companies (with analyst coverage) in the same industry are forecast to see their revenue grow 6.3% annually for the foreseeable future. It's pretty clear that CES Energy Solutions' revenues are expected to perform substantially worse than the wider industry.
The Bottom Line
The most important thing to take away is that the analysts reconfirmed their loss per share estimates for next year. On the plus side, there were no major changes to revenue estimates; although forecasts imply revenues will perform worse than the wider industry. 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 said, the long-term trajectory of the company's earnings is a lot more important than next year. At Simply Wall St, we have a full range of analyst estimates for CES Energy Solutions going out to 2022, and you can see them free on our platform here..
And what about risks? Every company has them, and we've spotted 2 warning signs for CES Energy Solutions you should know about.
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. 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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