Broker Revenue Forecasts For Fibra Terrafina (BMV:TERRA13) Are Surging Higher

Fibra Terrafina (BMV:TERRA13) shareholders will have a reason to smile today, with the analysts making substantial upgrades to this year's forecasts. The analysts have sharply increased their revenue numbers, with a view that Fibra Terrafina will make substantially more sales than they'd previously expected.

Following the upgrade, the latest consensus from Fibra Terrafina's ten analysts is for revenues of Mex$4.7b in 2021, which would reflect a solid 9.2% improvement in sales compared to the last 12 months. Before the latest update, the analysts were foreseeing Mex$3.9b of revenue in 2021. It looks like there's been a clear increase in optimism around Fibra Terrafina, given the considerable lift to revenue forecasts.

See our latest analysis for Fibra Terrafina

We'd point out that there was no major changes to their price target of US$1.61, suggesting the latest estimates were not enough to shift their view on the value of the business. 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 Fibra Terrafina at US$41.18 per share, while the most bearish prices it at US$28.99. As you can see the range of estimates is wide, with the lowest valuation coming in at less than half the most bullish estimate, suggesting there are some strongly diverging views on how think this business will perform. With this in mind, we wouldn't rely too heavily on the consensus price target, as it is just an average and analysts clearly have some deeply divergent views on the business.

Another way we can view these estimates is in the context of the bigger picture, such as how the forecasts stack up against past performance, and whether forecasts are more or less bullish relative to other companies in the industry. The period to the end of 2021 brings more of the same, according to the analysts, with revenue forecast to display 12% growth on an annualised basis. That is in line with its 12% annual growth over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to see their revenues grow 7.0% per year. So although Fibra Terrafina is expected to maintain its revenue growth rate, it's definitely 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. 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 Fibra Terrafina.

Analysts are definitely bullish on Fibra Terrafina, but no company is perfect. Indeed, you should know that there are several potential concerns to be aware of, including its declining profit margins. For more information, you can click through to our platform to learn more about this and the 3 other warning signs we've identified .

Of course, seeing company management invest large sums of money in a stock can be just as useful as knowing whether analysts are upgrading their estimates. So you may also wish to search this free list of stocks that insiders are buying.

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