News Flash: Analysts Just Made A Notable Upgrade To Their Chemtrade Logistics Income Fund (TSE:CHE.UN) Forecasts

Chemtrade Logistics Income Fund (TSE:CHE.UN) shareholders will have a reason to smile today, with the analysts making substantial upgrades to this year's statutory forecasts. The analysts have sharply increased their revenue numbers, with a view that Chemtrade Logistics Income Fund will make substantially more sales than they'd previously expected. The market seems to be pricing in some improvement in the business too, with the stock up 8.6% over the past week, closing at CA$8.98. Whether the upgrade is enough to drive the stock price higher is yet to be seen, however.

After this upgrade, Chemtrade Logistics Income Fund's four analysts are now forecasting revenues of CA$1.7b in 2022. This would be a notable 8.3% improvement in sales compared to the last 12 months. Before the latest update, the analysts were foreseeing CA$1.5b of revenue in 2022. The consensus has definitely become more optimistic, showing a solid increase in revenue forecasts.

View our latest analysis for Chemtrade Logistics Income Fund

There was no particular change to the consensus price target of CA$10.00, with Chemtrade Logistics Income Fund'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. Currently, the most bullish analyst values Chemtrade Logistics Income Fund at CA$12.00 per share, while the most bearish prices it at CA$8.00. These price targets show that analysts do have some differing views on the business, but the estimates do not vary enough to suggest to us that some are betting on wild success or utter failure.

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. For example, we noticed that Chemtrade Logistics Income Fund's rate of growth is expected to accelerate meaningfully, with revenues forecast to exhibit 17% growth to the end of 2022 on an annualised basis. That is well above its historical decline of 0.9% a year over the past five years. Compare this against analyst estimates for the broader industry, which suggest that (in aggregate) industry revenues are expected to decline 5.7% per year. So it's pretty clear that Chemtrade Logistics Income Fund is expected 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 this year. They're also forecasting for revenues to perform better than companies in the wider market. Given that analysts appear to be expecting substantial improvement in the sales pipeline, now could be the right time to take another look at Chemtrade Logistics Income Fund.

It's great to see the analysts upgrading their estimates, but the biggest highlight to us is that the business is expected to become profitable in the foreseeable future. For more information, you can click through to our free platform to learn more about these forecasts.

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.