Earnings Miss: Pembina Pipeline Corporation Missed EPS By 17% And Analysts Are Revising Their Forecasts

It's shaping up to be a tough period for Pembina Pipeline Corporation (TSE:PPL), which a week ago released some disappointing quarterly results that could have a notable impact on how the market views the stock. Pembina Pipeline missed earnings this time around, with CA$1.8b revenue coming in 7.7% below what the analysts had modelled. Statutory earnings per share (EPS) of CA$0.60 also fell short of expectations by 17%. This is an important time for investors, as they can track a company's performance in its report, look at what experts are forecasting for next year, and see if there has been any change to expectations for the business. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether the analysts have changed their mind on Pembina Pipeline after the latest results.

Check out our latest analysis for Pembina Pipeline

After the latest results, the consensus from Pembina Pipeline's seven analysts is for revenues of CA$8.65b in 2025, which would reflect a not inconsiderable 12% decline in revenue compared to the last year of performance. Per-share earnings are expected to accumulate 3.2% to CA$3.29. In the lead-up to this report, the analysts had been modelling revenues of CA$8.73b and earnings per share (EPS) of CA$3.39 in 2025. So it looks like there's been a small decline in overall sentiment after the recent results - there's been no major change to revenue estimates, but the analysts did make a small dip in their earnings per share forecasts.

It might be a surprise to learn that the consensus price target was broadly unchanged at CA$61.13, with the analysts clearly implying that the forecast decline in earnings is not expected to have much of an impact on valuation. There's another way to think about price targets though, and that's to look at the range of price targets put forward by analysts, because a wide range of estimates could suggest a diverse view on possible outcomes for the business. Currently, the most bullish analyst values Pembina Pipeline at CA$67.00 per share, while the most bearish prices it at CA$55.00. Even so, with a relatively close grouping of estimates, it looks like the analysts are quite confident in their valuations, suggesting Pembina Pipeline is an easy business to forecast or the the analysts are all using similar assumptions.

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. These estimates imply that revenue is expected to slow, with a forecast annualised decline of 10.0% by the end of 2025. This indicates a significant reduction from annual growth of 8.8% over the last five years. Compare this with our data, which suggests that other companies in the same industry are, in aggregate, expected to see their revenue grow 1.3% per year. It's pretty clear that Pembina Pipeline's revenues are expected to perform substantially worse than the wider industry.

The Bottom Line

The biggest concern is that the analysts reduced their earnings per share estimates, suggesting business headwinds could lay ahead for Pembina Pipeline. On the plus side, there were no major changes to revenue estimates; although forecasts imply they will perform worse than the wider industry. The consensus price target held steady at CA$61.13, with the latest estimates not enough to have an impact on their price targets.

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 estimates - from multiple Pembina Pipeline analysts - going out to 2026, and you can see them free on our platform here.

However, before you get too enthused, we've discovered 2 warning signs for Pembina Pipeline 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.