Beach Energy Limited (ASX:BPT) Just Reported, And Analysts Assigned A AU$1.58 Price Target

Last week, you might have seen that Beach Energy Limited (ASX:BPT) released its annual result to the market. The early response was not positive, with shares down 6.8% to AU$1.30 in the past week. Revenues were in line with expectations, at AU$1.8b, while statutory losses ballooned to AU$0.21 per share. Earnings are an important time for investors, as they can track a company's performance, look at what the analysts are forecasting for next year, and see if there's been a change in sentiment towards the company. So we collected the latest post-earnings statutory consensus estimates to see what could be in store for next year.

Check out our latest analysis for Beach Energy

Taking into account the latest results, Beach Energy's 15 analysts currently expect revenues in 2025 to be AU$1.77b, approximately in line with the last 12 months. Beach Energy is also expected to turn profitable, with statutory earnings of AU$0.17 per share. In the lead-up to this report, the analysts had been modelling revenues of AU$1.84b and earnings per share (EPS) of AU$0.20 in 2025. The analysts seem less optimistic after the recent results, reducing their revenue forecasts and making a substantial drop in earnings per share numbers.

It'll come as no surprise then, to learn that the analysts have cut their price target 11% to AU$1.58. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. There are some variant perceptions on Beach Energy, with the most bullish analyst valuing it at AU$2.58 and the most bearish at AU$1.10 per share. Note the wide gap in analyst price targets? This implies to us that there is a fairly broad range of possible scenarios for the underlying business.

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Beach Energy's past performance and to peers in the same industry. One thing that stands out from these estimates is that revenues are expected to keep falling until the end of 2025, roughly in line with the historical decline of 1.5% per annum over the past five years. Compare this against analyst estimates for companies in the broader industry, which suggest that revenues (in aggregate) are expected to grow 6.0% annually. So while a broad number of companies are forecast to grow, unfortunately Beach Energy is expected to see its revenue affected worse than other companies in the industry.

The Bottom Line

The biggest concern is that the analysts reduced their earnings per share estimates, suggesting business headwinds could lay ahead for Beach Energy. Unfortunately, they also downgraded their revenue estimates, and our data indicates underperformance compared to the wider industry. Even so, earnings per share are more important to the intrinsic value of the business. The consensus price target fell measurably, with the analysts seemingly not reassured by the latest results, leading to a lower estimate of Beach Energy's future valuation.

With that in mind, we wouldn't be too quick to come to a conclusion on Beach Energy. Long-term earnings power is much more important than next year's profits. We have estimates - from multiple Beach Energy analysts - going out to 2027, and you can see them free on our platform here.

Don't forget that there may still be risks. For instance, we've identified 1 warning sign for Beach Energy that you should be aware of.

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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.