Analyst Forecasts For Canacol Energy Ltd (TSE:CNE) Are Surging Higher

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Shareholders in Canacol Energy Ltd (TSE:CNE) may be thrilled to learn that the analysts have just delivered a major upgrade to their near-term forecasts. The consensus statutory numbers for both revenue and earnings per share (EPS) increased, with their view clearly much more bullish on the company's business prospects.

Following the latest upgrade, the current consensus, from the three analysts covering Canacol Energy, is for revenues of US$259m in 2021, which would reflect a discernible 4.6% reduction in Canacol Energy's sales over the past 12 months. Statutory earnings per share are presumed to surge 274% to US$0.38. Previously, the analysts had been modelling revenues of US$251m and earnings per share (EPS) of US$0.31 in 2021. So it seems there's been a definite increase in optimism about Canacol Energy's future following the latest consensus numbers, with a very substantial lift in the earnings per share forecasts in particular.

See our latest analysis for Canacol Energy

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TSX:CNE Earnings and Revenue Growth August 8th 2021

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Canacol Energy's past performance and to peers in the same industry. These estimates imply that sales are expected to slow, with a forecast annualised revenue decline of 9.0% by the end of 2021. This indicates a significant reduction from annual growth of 19% 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 5.3% annually for the foreseeable future. It's pretty clear that Canacol Energy's revenues are expected to perform substantially worse than the wider industry.

The Bottom Line

The most important thing to take away from this upgrade is that analysts upgraded their earnings per share estimates for this year, expecting improving business conditions. Fortunately, they also upgraded their revenue estimates, and are forecasting revenues to grow slower than the wider market. With a serious upgrade to expectations, it might be time to take another look at Canacol Energy.

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 Canacol Energy going out to 2023, and you can see them free on our platform here..

Another thing to consider is whether management and directors have been buying or selling stock recently. We provide an overview of all open market stock trades for the last twelve months on our platform, here.

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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