Stock Analysis

Upgrade: Analysts Just Made A Notable Increase To Their Hafnia Limited (OB:HAFNI) Forecasts

OB:HAFNI
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Hafnia Limited (OB:HAFNI) shareholders will have a reason to smile today, with the analysts making substantial upgrades to this year's forecasts. The analysts greatly increased their revenue estimates, suggesting a stark improvement in business fundamentals. The market may be pricing in some blue sky too, with the share price gaining 15% to kr31.75 in the last 7 days. Could this upgrade be enough to drive the stock even higher?

Following the upgrade, the most recent consensus for Hafnia from its four analysts is for revenues of US$1.0b in 2022 which, if met, would be a notable 16% increase on its sales over the past 12 months. Losses are expected to turn into profits real soon, with the analysts forecasting US$0.89 in per-share earnings. Before this latest update, the analysts had been forecasting revenues of US$905m and earnings per share (EPS) of US$0.54 in 2022. So we can see there's been a pretty clear increase in analyst sentiment in recent times, with both revenues and earnings per share receiving a decent lift in the latest estimates.

Check out our latest analysis for Hafnia

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OB:HAFNI Earnings and Revenue Growth May 26th 2022

With these upgrades, we're not surprised to see that the analysts have lifted their price target 35% to kr44.50 per share. 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 Hafnia at kr49.00 per share, while the most bearish prices it at kr39.00. Still, with such a tight range of estimates, it suggests the analysts have a pretty good idea of what they think the company is worth.

Looking at the bigger picture now, one of the ways we can make sense of these forecasts is to see how they measure up against both past performance and industry growth estimates. The analysts are definitely expecting Hafnia's growth to accelerate, with the forecast 22% annualised growth to the end of 2022 ranking favourably alongside historical growth of 15% per annum over the past year. Compare this with other companies in the same industry, which are forecast to see a revenue decline of 11% annually. It seems obvious that as part of the brighter growth outlook, Hafnia is expected to grow faster than the wider industry.

The Bottom Line

The most important thing to take away from this upgrade is that analysts upgraded their earnings per share estimates for this year, expecting improving business conditions. Fortunately, they also upgraded their revenue estimates, and our data indicates sales are expected to perform better than the wider market. With a serious upgrade to expectations and a rising price target, it might be time to take another look at Hafnia.

Analysts are definitely bullish on Hafnia, but no company is perfect. Indeed, you should know that there are several potential concerns to be aware of, including dilutive stock issuance over the past year. For more information, you can click through to our platform to learn more about this and the 2 other flags 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.

Valuation is complex, but we're here to simplify it.

Discover if Hafnia might be undervalued or overvalued with our detailed analysis, featuring fair value estimates, potential risks, dividends, insider trades, and its financial condition.

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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.