Growth Investors: Industry Analysts Just Upgraded Their Tenaris S.A. (BIT:TEN) Revenue Forecasts By 11%

Tenaris S.A. (BIT:TEN) shareholders will have a reason to smile today, with the analysts making substantial upgrades to this year's statutory forecasts. The revenue forecast for this year has experienced a facelift, with the analysts now much more optimistic on its sales pipeline. The market seems to be pricing in some improvement in the business too, with the stock up 9.9% over the past week, closing at €12.01. It will be interesting to see if this latest upgrade is enough to kickstart further buying interest in the stock.

After the upgrade, the 18 analysts covering Tenaris are now predicting revenues of US$9.4b in 2022. If met, this would reflect a huge 45% improvement in sales compared to the last 12 months. Prior to the latest estimates, the analysts were forecasting revenues of US$8.5b in 2022. The consensus has definitely become more optimistic, showing a solid increase in revenue forecasts.

Check out our latest analysis for Tenaris

We'd point out that there was no major changes to their price target of US$14.66, suggesting the latest estimates were not enough to shift their view on the value of the business. 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 Tenaris analyst has a price target of US$16.36 per share, while the most pessimistic values it at US$8.39. This shows there is still some diversity in estimates, but analysts don't appear to be totally split on the stock as though it might be a success or failure situation.

Taking a look at the bigger picture now, one of the ways we can understand these forecasts is to see how they compare to both past performance and industry growth estimates. The analysts are definitely expecting Tenaris' growth to accelerate, with the forecast 45% annualised growth to the end of 2022 ranking favourably alongside historical growth of 2.9% per annum over the past five years. Compare this with other companies in the same industry, which are forecast to grow their revenue 7.1% annually. Factoring in the forecast acceleration in revenue, it's pretty clear that Tenaris is expected to grow much faster than its industry.

The Bottom Line

The highlight for us was that analysts increased their revenue forecasts for Tenaris this year. They're also forecasting more rapid revenue growth than 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 Tenaris.

Better yet, our automated discounted cash flow calculation (DCF) suggests Tenaris could be moderately undervalued. For more information, you can click through to our platform to learn more about our valuation approach.

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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

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.