Awilco LNG ASA Just Beat EPS By 32%: Here's What Analysts Think Will Happen Next

Investors in Awilco LNG ASA (OB:ALNG) had a good week, as its shares rose 6.5% to close at kr6.25 following the release of its first-quarter results. It looks like a credible result overall - although revenues of US$14m were what the analyst expected, Awilco LNG surprised by delivering a (statutory) profit of US$0.05 per share, an impressive 32% above what was forecast. Earnings are an important time for investors, as they can track a company's performance, look at what the analyst is forecasting for next year, and see if there's been a change in sentiment towards the company. So we gathered the latest post-earnings forecasts to see what estimate suggests is in store for next year.

View our latest analysis for Awilco LNG

Taking into account the latest results, the single analyst covering Awilco LNG provided consensus estimates of US$54.9m revenue in 2022, which would reflect a small 2.5% decline on its sales over the past 12 months. Statutory earnings per share are forecast to decrease 4.6% to US$0.15 in the same period. Before this earnings report, the analyst had been forecasting revenues of US$54.5m and earnings per share (EPS) of US$0.071 in 2022. Although the revenue estimates have not really changed, we can see there's been a great increase in earnings per share expectations, suggesting that the analyst has become more bullish after the latest result.

The consensus price target was unchanged at kr5.93, implying that the improved earnings outlook is not expected to have a long term impact on value creation for shareholders.

Of course, another way to look at these forecasts is to place them into context against the industry itself. These estimates imply that sales are expected to slow, with a forecast annualised revenue decline of 3.3% by the end of 2022. This indicates a significant reduction from annual growth of 16% over the last five years. Yet aggregate analyst estimates for other companies in the industry suggest that industry revenues are forecast to decline 11% per year. So it's pretty clear that Awilco LNG's revenues are expected to shrink slower than the wider industry.

The Bottom Line

The most important thing here is that the analyst upgraded their earnings per share estimates, suggesting that there has been a clear increase in optimism towards Awilco LNG following these results. Fortunately, they also reconfirmed their revenue estimates, suggesting sales are tracking in line with expectations. Their estimates also suggest that Awilco LNG's revenues are expected to perform better than the wider industry. There was no real change to the consensus price target, suggesting that the intrinsic value of the business has not undergone any major changes with the latest estimates.

Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. At least one analyst has provided forecasts out to 2024, which can be seen for free on our platform here.

And what about risks? Every company has them, and we've spotted 3 warning signs for Awilco LNG (of which 1 is a bit concerning!) you should know about.

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.