Growth Investors: Industry Analysts Just Upgraded Their Petro Rio S.A. (BVMF:PRIO3) Revenue Forecasts By 14%

Shareholders in Petro Rio S.A. (BVMF:PRIO3) may be thrilled to learn that the analysts have just delivered a major upgrade to their near-term forecasts. The analysts have sharply increased their revenue numbers, with a view that Petro Rio will make substantially more sales than they'd previously expected. The stock price has risen 9.5% to R$26.80 over the past week, suggesting investors are becoming more optimistic. It will be interesting to see if this latest upgrade is enough to kickstart further buying interest in the stock.

Following the upgrade, the current consensus from Petro Rio's seven analysts is for revenues of R$6.7b in 2022 which - if met - would reflect a substantial 52% increase on its sales over the past 12 months. Before the latest update, the analysts were foreseeing R$5.9b of revenue in 2022. The consensus has definitely become more optimistic, showing a solid increase in revenue forecasts.

See our latest analysis for Petro Rio

There was no particular change to the consensus price target of R$37.60, with Petro Rio's latest outlook seemingly not enough to result in a change of valuation. 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 Petro Rio, with the most bullish analyst valuing it at R$47.00 and the most bearish at R$22.00 per share. This is a fairly broad spread of estimates, suggesting that the analysts are forecasting a wide range of possible outcomes for the business.

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 period to the end of 2022 brings more of the same, according to the analysts, with revenue forecast to display 52% growth on an annualised basis. That is in line with its 44% annual growth over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to see their revenues grow 7.7% per year. So it's pretty clear that Petro Rio is forecast to grow substantially faster than its industry.

The Bottom Line

The highlight for us was that analysts increased their revenue forecasts for Petro Rio this year. The analysts also expect revenues to grow faster than the wider market. Seeing the dramatic upgrade to this year's forecasts, it might be time to take another look at Petro Rio.

But wait - there's more! We have analyst estimates for Petro Rio going out to 2024, and you can see them free on our platform here.

Of course, seeing company management invest large sums of money in a stock can be just as useful as knowing whether analysts are upgrading their estimates. So you may also wish to search this free list of stocks 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.