Celebrations may be in order for Navigator Global Investments Limited (ASX:NGI) shareholders, with the analysts delivering a significant upgrade to their statutory estimates for the company. The analysts greatly increased their revenue estimates, suggesting a stark improvement in business fundamentals. Investors have been pretty optimistic on Navigator Global Investments too, with the stock up 13% to AU$1.49 over the past week. Could this upgrade be enough to drive the stock even higher?

Following the upgrade, the latest consensus from Navigator Global Investments' twin analysts is for revenues of US$113m in 2022, which would reflect a huge 28% improvement in sales compared to the last 12 months. Statutory earnings per share are anticipated to reduce 4.1% to US$0.11 in the same period. Before this latest update, the analysts had been forecasting revenues of US$101m and earnings per share (EPS) of US$0.097 in 2022. So we can see there's been a pretty clear increase in analyst sentiment in recent times, with both revenues and earnings per share receiving a decent lift in the latest estimates.

View our latest analysis for Navigator Global Investments

As a result, it might be a surprise to see that the analysts have cut their price target 5.6% to AU$2.20, which could suggest the forecast improvement in performance is not expected to last. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. The most optimistic Navigator Global Investments analyst has a price target of AU$2.20 per share, while the most pessimistic values it at AU$2.19. 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.

Of course, another way to look at these forecasts is to place them into context against the industry itself. The analysts are definitely expecting Navigator Global Investments' growth to accelerate, with the forecast 65% annualised growth to the end of 2022 ranking favourably alongside historical growth of 3.9% per annum over the past five years. Compare this with other companies in the same industry, which are forecast to grow their revenue 3.3% annually. Factoring in the forecast acceleration in revenue, it's pretty clear that Navigator Global Investments is expected to grow much faster than its 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, analysts also upgraded their revenue estimates, and our data indicates sales are expected to perform better than the wider market. A lower price target is not intuitively what we would expect from a company whose business prospects are improving - at least judging by these forecasts - but if the underlying fundamentals are strong, Navigator Global Investments could be one for the watch list.