NETSTREIT Corp. (NYSE:NTST) shareholders will have a reason to smile today, with the analysts making substantial upgrades to this year's forecasts. The analysts have sharply increased their revenue numbers, with a view that NETSTREIT will make substantially more sales than they'd previously expected.

After this upgrade, NETSTREIT's seven analysts are now forecasting revenues of US$86m in 2022. This would be a sizeable 63% improvement in sales compared to the last 12 months. Per-share earnings are expected to surge 60% to US$0.15. Previously, the analysts had been modelling revenues of US$79m and earnings per share (EPS) of US$0.23 in 2022. So it's pretty clear the analysts have mixed opinions on NETSTREIT even after this update; although they upped their revenue numbers, it came at the cost of a pretty serious decline to per-share earnings expectations.

View our latest analysis for NETSTREIT

The consensus price target was unchanged at US$26.78, suggesting the business is performing roughly in line with expectations, despite some adjustments to profit and revenue forecasts. Fixating on a single price target can be unwise though, since the consensus target is effectively the average of analyst price targets. As a result, some investors like to look at the range of estimates to see if there are any diverging opinions on the company's valuation. The most optimistic NETSTREIT analyst has a price target of US$32.00 per share, while the most pessimistic values it at US$23.00. Analysts definitely have varying views on the business, but the spread of estimates is not wide enough in our view to suggest that extreme outcomes could await NETSTREIT shareholders.

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 NETSTREIT's rate of growth is expected to accelerate meaningfully, with the forecast 63% annualised revenue growth to the end of 2022 noticeably faster than its historical growth of 37% p.a. over the past three years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to grow their revenue at 7.4% per year. Factoring in the forecast acceleration in revenue, it's pretty clear that NETSTREIT is expected to grow much faster than its industry.

The Bottom Line

The most important thing to take away is that analysts cut their earnings per share estimates, expecting a clear decline in business conditions. Fortunately, analysts also upgraded their revenue estimates, and our data indicates sales are expected to perform better than the wider market. Given that analysts appear to be expecting substantial improvement in the sales pipeline, now could be the right time to take another look at NETSTREIT.