Revenue Beat: Fortis Inc. Exceeded Revenue Forecasts By 6.5% And Analysts Are Updating Their Estimates

As you might know, Fortis Inc. (TSE:FTS) just kicked off its latest quarterly results with some very strong numbers. The company beat expectations with revenues of CA$3.3b arriving 6.5% ahead of forecasts. Statutory earnings per share (EPS) were CA$1.00, 3.1% ahead of estimates. 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. So we gathered the latest post-earnings forecasts to see what estimates suggest is in store for next year.

Our free stock report includes 2 warning signs investors should be aware of before investing in Fortis. Read for free now.

Taking into account the latest results, the most recent consensus for Fortis from eleven analysts is for revenues of CA$12.1b in 2025. If met, it would imply an okay 3.5% increase on its revenue over the past 12 months. Per-share earnings are expected to rise 3.5% to CA$3.40. Before this earnings report, the analysts had been forecasting revenues of CA$12.4b and earnings per share (EPS) of CA$3.40 in 2025. So it looks like the analysts have become a bit less optimistic after the latest results announcement, with revenues expected to fall even as the company is supposed to maintain EPS.

Check out our latest analysis for Fortis

The average price target was steady at CA$65.69even though revenue estimates declined; likely suggesting the analysts place a higher value on earnings. The consensus price target is just an average of individual analyst targets, so - it could be handy to see how wide the range of underlying estimates is. The most optimistic Fortis analyst has a price target of CA$72.00 per share, while the most pessimistic values it at CA$42.00. 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.

Of course, another way to look at these forecasts is to place them into context against the industry itself. It's pretty clear that there is an expectation that Fortis' revenue growth will slow down substantially, with revenues to the end of 2025 expected to display 4.6% growth on an annualised basis. This is compared to a historical growth rate of 6.9% over the past five years. Juxtapose this against the other companies in the industry with analyst coverage, which are forecast to grow their revenues (in aggregate) 4.6% annually. Factoring in the forecast slowdown in growth, it looks like Fortis is forecast to grow at about the same rate as the wider industry.

The Bottom Line

The most important thing to take away is that there's been no major change in sentiment, with the analysts reconfirming that the business is performing in line with their previous earnings per share estimates. Sadly, they also downgraded their revenue forecasts, but the business is still expected to grow at roughly the same rate as the industry itself. Even so, long term profitability is more important for the value creation process. The consensus price target held steady at CA$65.69, with the latest estimates not enough to have an impact on their price targets.

With that said, the long-term trajectory of the company's earnings is a lot more important than next year. We have forecasts for Fortis going out to 2027, and you can see them free on our platform here.

Plus, you should also learn about the 2 warning signs we've spotted with Fortis (including 1 which shouldn't be ignored) .

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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.