Industry Analysts Just Made A Captivating Upgrade To Their PrairieSky Royalty Ltd. (TSE:PSK) Revenue Forecasts

Celebrations may be in order for PrairieSky Royalty Ltd. (TSE:PSK) shareholders, with the analysts delivering a significant upgrade to their statutory estimates for the company. The consensus estimated revenue numbers rose, with their view now clearly much more bullish on the company's business prospects.

After this upgrade, PrairieSky Royalty's four analysts are now forecasting revenues of CA$351m in 2022. This would be a huge 44% improvement in sales compared to the last 12 months. Prior to the latest estimates, the analysts were forecasting revenues of CA$318m in 2022. It looks like there's been a clear increase in optimism around PrairieSky Royalty, given the nice gain to revenue forecasts.

See our latest analysis for PrairieSky Royalty

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the PrairieSky Royalty's past performance and to peers in the same industry. One thing stands out from these estimates, which is that PrairieSky Royalty is forecast to grow faster in the future than it has in the past, with revenues expected to display 34% annualised growth until the end of 2022. If achieved, this would be a much better result than the 3.9% annual decline over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in the industry are forecast to see their revenue grow 7.6% per year. Not only are PrairieSky Royalty's revenues expected to improve, it seems that the analysts are also expecting it to grow faster than the wider industry.

The Bottom Line

The most important thing to take away from this upgrade is that analysts lifted their revenue estimates for next year. The analysts also expect revenues to grow faster than the wider market. Seeing the dramatic upgrade to next year's forecasts, it might be time to take another look at PrairieSky Royalty.

Better yet, our automated discounted cash flow calculation (DCF) suggests PrairieSky Royalty could be moderately 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.