CES Energy Solutions Corp. Just Beat Earnings Expectations: Here's What Analysts Think Will Happen Next

CES Energy Solutions Corp. (TSE:CEU) defied analyst predictions to release its quarterly results, which were ahead of market expectations. The company beat forecasts, with revenue of CA$589m, some 4.9% above estimates, and statutory earnings per share (EPS) coming in at CA$0.23, 64% ahead of expectations. 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.

View our latest analysis for CES Energy Solutions

Taking into account the latest results, the consensus forecast from CES Energy Solutions' seven analysts is for revenues of CA$2.29b in 2024. This reflects a satisfactory 4.2% improvement in revenue compared to the last 12 months. Statutory per-share earnings are expected to be CA$0.75, roughly flat on the last 12 months. In the lead-up to this report, the analysts had been modelling revenues of CA$2.21b and earnings per share (EPS) of CA$0.63 in 2024. So it seems there's been a definite increase in optimism about CES Energy Solutions' future following the latest results, with a decent improvement in the earnings per share forecasts in particular.

It will come as no surprise to learn that the analysts have increased their price target for CES Energy Solutions 21% to CA$8.18on the back of these upgrades. 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. The most optimistic CES Energy Solutions analyst has a price target of CA$9.00 per share, while the most pessimistic values it at CA$5.85. There are definitely some different views on the stock, but the range of estimates is not wide enough as to imply that the situation is unforecastable, in our view.

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. We would highlight that CES Energy Solutions' revenue growth is expected to slow, with the forecast 5.7% annualised growth rate until the end of 2024 being well below the historical 16% p.a. growth over the last five years. Compare this with other companies in the same industry, which are forecast to see a revenue decline of 9.0% annually. Factoring in the forecast slowdown in growth, it's pretty clear that CES Energy Solutions is still expected to grow faster than the wider industry.

The Bottom Line

The most important thing here is that the analysts upgraded their earnings per share estimates, suggesting that there has been a clear increase in optimism towards CES Energy Solutions following these results. On the plus side, they also lifted their revenue estimates, and the company is expected to perform better than the wider industry. We note an upgrade to the price target, suggesting that the analysts believes the intrinsic value of the business is likely to improve over time.

Following on from that line of thought, we think that the long-term prospects of the business are much more relevant than next year's earnings. We have forecasts for CES Energy Solutions going out to 2026, and you can see them free on our platform here.

Don't forget that there may still be risks. For instance, we've identified 2 warning signs for CES Energy Solutions 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.