Broker Revenue Forecasts For Repsol, S.A. (BME:REP) Are Surging Higher

By
Simply Wall St
Published
April 06, 2022
BME:REP
Source: Shutterstock

Celebrations may be in order for Repsol, S.A. (BME:REP) 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.

Following the upgrade, the current consensus from Repsol's 22 analysts is for revenues of €55b in 2022 which - if met - would reflect a major 24% increase on its sales over the past 12 months. Before the latest update, the analysts were foreseeing €50b of revenue in 2022. It looks like there's been a clear increase in optimism around Repsol, given the solid increase in revenue forecasts.

Check out our latest analysis for Repsol

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BME:REP Earnings and Revenue Growth April 6th 2022

There was no particular change to the consensus price target of €13.94, with Repsol's latest outlook seemingly not enough to result in a change of valuation. That's not the only conclusion we can draw from this data however, as some investors also like to consider the spread in estimates when evaluating analyst price targets. Currently, the most bullish analyst values Repsol at €18.00 per share, while the most bearish prices it at €10.70. Analysts definitely have varying views on the business, but the spread of estimates is not wide enough in our view to suggest that extreme outcomes could await Repsol shareholders.

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Repsol's past performance and to peers in the same industry. The analysts are definitely expecting Repsol's growth to accelerate, with the forecast 24% annualised growth to the end of 2022 ranking favourably alongside historical growth of 1.1% per annum 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 3.9% per year. Factoring in the forecast acceleration in revenue, it's pretty clear that Repsol is expected to grow much faster than its industry.

The Bottom Line

The highlight for us was that analysts increased their revenue forecasts for Repsol this year. Analysts also expect revenues to grow faster than the wider market. Seeing the dramatic upgrade to this year's forecasts, it might be time to take another look at Repsol.

But wait - there's more! We have analyst estimates for Repsol going out to 2024, and you can see them free 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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