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Celebrations may be in order for Solaris Energy Infrastructure, Inc. (NYSE:SEI) shareholders, with the covering analyst delivering a significant upgrade to their statutory estimates for the company. The revenue forecast for next year has experienced a facelift, with the analyst now much more optimistic on its sales pipeline. Investors have been pretty optimistic on Solaris Energy Infrastructure too, with the stock up 33% to US$17.15 over the past week. We'll be curious to see if these new estimates convince the market to lift the stock price higher still.
After the upgrade, the single analyst covering Solaris Energy Infrastructure is now predicting revenues of US$734m in 2025. If met, this would reflect a sizeable 162% improvement in sales compared to the last 12 months. Statutory earnings per share are presumed to bounce 143% to US$1.03. Before this latest update, the analyst had been forecasting revenues of US$640m and earnings per share (EPS) of US$0.94 in 2025. The forecasts seem more optimistic now, with a decent improvement in revenue and a modest lift to earnings per share estimates.
View our latest analysis for Solaris Energy Infrastructure
It will come as no surprise to learn that the analyst has increased their price target for Solaris Energy Infrastructure 24% to US$20.50 on the back of these upgrades.
One way to get more context on these forecasts is to look at how they compare to both past performance, and how other companies in the same industry are performing. The analyst is definitely expecting Solaris Energy Infrastructure's growth to accelerate, with the forecast 116% annualised growth to the end of 2025 ranking favourably alongside historical growth of 14% per annum over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to grow their revenue at 5.5% per year. It seems obvious that, while the growth outlook is brighter than the recent past, the analyst also expect Solaris Energy Infrastructure to grow faster than the wider industry.
The Bottom Line
The biggest takeaway for us from these new estimates is that the analyst upgraded their earnings per share estimates, with improved earnings power expected for next year. They also upgraded their revenue estimates for next year, and sales are expected to grow faster than the wider market. There was also a nice increase in the price target, with the analyst apparently feeling that the intrinsic value of the business is improving. Given that the analyst appears to be expecting substantial improvement in the sales pipeline, now could be the right time to take another look at Solaris Energy Infrastructure.