Yahoo Finance Crew Energy Inc. Earnings Missed Analyst Estimates: Here's What Analysts Are Forecasting Now
As you might know, Crew Energy Inc. (TSE:CR) last week released its latest full-year, and things did not turn out so great for shareholders. It wasn't a great result overall - while revenue fell marginally short of analyst estimates at CA$188m, statutory earnings missed forecasts by 16%, coming in at just CA$0.08 per share. Analysts typically update their forecasts at each earnings report, and we can judge from their estimates whether their view of the company has changed or if there are any new concerns to be aware of. We thought readers would find it interesting to see analysts' latest (statutory) post-earnings forecasts for next year.
View our latest analysis for Crew Energy
Taking into account the latest results, the current consensus, from the five analysts covering Crew Energy, is for revenues of CA$150.5m in 2020, which would reflect an uneasy 20% reduction in Crew Energy's sales over the past 12 months. Earnings are expected to tip over into lossmaking territory, with analysts forecasting statutory losses of -CA$0.14 per share in 2020. Before this latest report, the consensus had been expecting revenues of CA$204.4m and CA$0.11 per share in losses. It looks like analyst sentiment has declined substantially in the aftermath of these results, with a pretty serious reduction to revenue estimates and a large cut to consensus earnings per share numbers as well.
The consensus price target fell 24% to CA$0.64, with analysts clearly concerned about the company following the weaker revenue and earnings outlook. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. Currently, the most bullish analyst values Crew Energy at CA$1.25 per share, while the most bearish prices it at CA$0.25. We would probably assign less value to the analyst forecasts in this situation, because such a wide range of estimates could imply that the future of this business is difficult to value accurately. With this in mind, we wouldn't assign too much meaning to the consensus price target, as it is just an average and analysts clearly have some deeply divergent views on the business.
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. One thing that stands out from these estimates is that, even though revenues are forecast to keep falling, the decline is expected to accelerate. Analysts have modelled a 20% decline next year, compared to a historical decline of 1.3% per annum for the past five years. By contrast, our data suggests that other companies (with analyst coverage) in the market are forecast to see their revenue decline 2.1% per year. So it looks like Crew Energy is also expected to see its revenues decline at a faster rate than the wider market.
The Bottom Line
The highlight for us was that the consensus reduced its estimated losses next year, perhaps suggesting Crew Energy is moving incrementally towards profitability. On the negative side, they also downgraded their revenue estimates, and forecasts imply revenues will perform worse than the wider market. The consensus price target fell measurably, with analysts seemingly not reassured by the latest results, leading to a lower estimate of Crew Energy's future valuation.
With that said, the long-term trajectory of the company's earnings is a lot more important than next year. We have estimates - from multiple Crew Energy analysts - going out to 2023, and you can see them free on our platform here.
You can also view our analysis of Crew Energy's balance sheet, and whether we think Crew Energy is carrying too much debt, for free on our platform here.
If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.com. 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. Simply Wall St has no position in the stocks mentioned.
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