Need To Know: One Analyst Is Much More Bullish On Cardinal Energy Ltd. (TSE:CJ) Revenues

Shareholders in Cardinal Energy Ltd. (TSE:CJ) may be thrilled to learn that the covering analyst has just delivered a major upgrade to their near-term forecasts. The analyst has sharply increased their revenue numbers, with a view that Cardinal Energy will make substantially more sales than they'd previously expected.

After the upgrade, the one analyst covering Cardinal Energy is now predicting revenues of CA$617m in 2023. If met, this would reflect a substantial 26% improvement in sales compared to the last 12 months. Before the latest update, the analyst was foreseeing CA$520m of revenue in 2023. The consensus has definitely become more optimistic, showing a nice gain to revenue forecasts.

See our latest analysis for Cardinal Energy

Of course, another way to look at these forecasts is to place them into context against the industry itself. It's clear from the latest estimates that Cardinal Energy's rate of growth is expected to accelerate meaningfully, with the forecast 58% annualised revenue growth to the end of 2023 noticeably faster than its historical growth of 14% p.a. over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to grow their revenue at 3.2% per year. It seems obvious that, while the growth outlook is brighter than the recent past, the analyst also expect Cardinal Energy to grow faster than the wider industry.

The Bottom Line

The most important thing to take away from this upgrade is that the analyst lifted their revenue estimates for this year. The analyst also expects revenues to grow faster than the wider market. Given that the analyst appears to be expecting substantial improvement in the sales pipeline, now could be the right time to take another look at Cardinal Energy.

Better yet, our automated discounted cash flow calculation (DCF) suggests Cardinal Energy could be moderately undervalued. For more information, you can click through to our platform to learn more about our valuation approach.

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.