Analysts' Revenue Estimates For HT&E Limited (ASX:HT1) Are Surging Higher

HT&E Limited (ASX:HT1) shareholders will have a reason to smile today, with the analysts making substantial upgrades to this year's statutory forecasts. The revenue forecast for this year has experienced a facelift, with analysts now much more optimistic on its sales pipeline.

Following the upgrade, the most recent consensus for HT&E from its six analysts is for revenues of AU$352m in 2022 which, if met, would be a sizeable 56% increase on its sales over the past 12 months. Prior to the latest estimates, the analysts were forecasting revenues of AU$298m in 2022. It looks like there's been a clear increase in optimism around HT&E, given the nice gain to revenue forecasts.

See our latest analysis for HT&E

There was no particular change to the consensus price target of AU$2.39, with HT&E's latest outlook seemingly not enough to result in a change of valuation. 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 HT&E, with the most bullish analyst valuing it at AU$2.80 and the most bearish at AU$1.55 per share. This shows there is still some diversity in estimates, but analysts don't appear to be totally split on the stock as though it might be a success or failure situation.

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. One thing stands out from these estimates, which is that HT&E is forecast to grow faster in the future than it has in the past, with revenues expected to display 56% annualised growth until the end of 2022. If achieved, this would be a much better result than the 7.7% annual decline over the past five years. Compare this against analyst estimates for the broader industry, which suggest that (in aggregate) industry revenues are expected to grow 3.2% annually. So it looks like HT&E is expected to grow faster than its competitors, at least for a while.

The Bottom Line

The most important thing to take away from this upgrade is that analysts lifted their revenue estimates for this year. They're also forecasting more rapid revenue growth 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 HT&E.

Using these estimates as a starting point, we've run a discounted cash flow calculation (DCF) on HT&E that suggests the company could be somewhat undervalued. You can learn more about our valuation methodology on our platform here.

Another way to search for interesting companies that could be reaching an inflection point is to track whether management are buying or selling, with our free list of growing companies that insiders are buying.

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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.