Yahoo Finance The Patterson-UTI Energy, Inc. (NASDAQ:PTEN) First-Quarter Results Are Out And Analysts Have Published New Forecasts
It's been a good week for Patterson-UTI Energy, Inc. (NASDAQ:PTEN) shareholders, because the company has just released its latest first-quarter results, and the shares gained 2.6% to US$10.77. Patterson-UTI Energy reported in line with analyst predictions, delivering revenues of US$1.5b and statutory earnings per share of US$0.13, suggesting the business is executing well and in line with its plan. This is an important time for investors, as they can track a company's performance in its report, look at what experts are forecasting for next year, and see if there has been any change to expectations for the business. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether the analysts have changed their mind on Patterson-UTI Energy after the latest results.
View our latest analysis for Patterson-UTI Energy
After the latest results, the 15 analysts covering Patterson-UTI Energy are now predicting revenues of US$5.95b in 2024. If met, this would reflect a huge 22% improvement in revenue compared to the last 12 months. Statutory earnings per share are forecast to dip 2.5% to US$0.48 in the same period. In the lead-up to this report, the analysts had been modelling revenues of US$6.16b and earnings per share (EPS) of US$0.63 in 2024. From this we can that sentiment has definitely become more bearish after the latest results, leading to lower revenue forecasts and a pretty serious reduction to earnings per share estimates.
Despite the cuts to forecast earnings, there was no real change to the US$15.56 price target, showing that the analysts don't think the changes have a meaningful impact on its intrinsic value. That's not the only conclusion we can draw from this data however, as some investors also like to consider the spread in estimates when evaluating analyst price targets. There are some variant perceptions on Patterson-UTI Energy, with the most bullish analyst valuing it at US$19.00 and the most bearish at US$14.00 per share. These price targets show that analysts do have some differing views on the business, but the estimates do not vary enough to suggest to us that some are betting on wild success or utter failure.
Looking at the bigger picture now, one of the ways we can make sense of these forecasts is to see how they measure up against both past performance and industry growth estimates. The analysts are definitely expecting Patterson-UTI Energy's growth to accelerate, with the forecast 31% annualised growth to the end of 2024 ranking favourably alongside historical growth of 11% per annum over the past five years. Compare this with other companies in the same industry, which are forecast to grow their revenue 7.6% annually. Factoring in the forecast acceleration in revenue, it's pretty clear that Patterson-UTI Energy is expected to grow much faster than its industry.
The Bottom Line
The biggest concern is that the analysts reduced their earnings per share estimates, suggesting business headwinds could lay ahead for Patterson-UTI Energy. Regrettably, they also downgraded their revenue estimates, but the latest forecasts still imply the business will grow faster than the wider industry. There was no real change to the consensus price target, suggesting that the intrinsic value of the business has not undergone any major changes with the latest estimates.
With that in mind, we wouldn't be too quick to come to a conclusion on Patterson-UTI Energy. Long-term earnings power is much more important than next year's profits. At Simply Wall St, we have a full range of analyst estimates for Patterson-UTI Energy going out to 2026, and you can see them free on our platform here..
Plus, you should also learn about the 5 warning signs we've spotted with Patterson-UTI Energy (including 1 which is a bit concerning) .
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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. 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.
