Sea1 Offshore Inc. Just Recorded A 93% EPS Beat: Here's What Analysts Are Forecasting Next

Sea1 Offshore Inc. (OB:SEA1) defied analyst predictions to release its first-quarter results, which were ahead of market expectations. It was a solid earnings report, with revenues and statutory earnings per share (EPS) both coming in strong. Revenues were 10% higher than the analysts had forecast, at US$69m, while EPS were US$0.14 beating analyst models by 93%. Following the result, the analysts have updated their earnings model, and it would be good to know whether they think there's been a strong change in the company's prospects, or if it's business as usual. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether the analysts have changed their mind on Sea1 Offshore after the latest results.

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Taking into account the latest results, the current consensus, from the three analysts covering Sea1 Offshore, is for revenues of US$258.9m in 2025. This implies a disturbing 21% reduction in Sea1 Offshore's revenue over the past 12 months. Statutory earnings per share are forecast to plummet 45% to US$0.66 in the same period. Before this earnings report, the analysts had been forecasting revenues of US$284.4m and earnings per share (EPS) of US$0.42 in 2025. Although the analysts have lowered their revenue forecasts, they've also made a great increase in their earnings per share estimates, which implies there's been something of an uptick in sentiment following the latest results.

View our latest analysis for Sea1 Offshore

There's been no real change to the average price target of kr31.46, with the lower revenue and higher earnings forecasts not expected to meaningfully impact the company's valuation over a longer timeframe. 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. The most optimistic Sea1 Offshore analyst has a price target of kr36.18 per share, while the most pessimistic values it at kr28.21. 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 analysts think this business will perform. With this in mind, we wouldn't rely too heavily the consensus price target, as it is just an average and analysts clearly have some deeply divergent views on the business.

One way to get more context on these forecasts is to look at how they compare to both past performance, and how other companies in the same industry are performing. We would highlight that revenue is expected to reverse, with a forecast 27% annualised decline to the end of 2025. That is a notable change from historical growth of 7.6% over the last five years. By contrast, our data suggests that other companies (with analyst coverage) in the same industry are forecast to see their revenue grow 3.2% annually for the foreseeable future. So although its revenues are forecast to shrink, this cloud does not come with a silver lining - Sea1 Offshore is expected to lag the wider industry.

The Bottom Line

The most important thing here is that the analysts upgraded their earnings per share estimates, suggesting that there has been a clear increase in optimism towards Sea1 Offshore following these results. Unfortunately, they also downgraded their revenue estimates, and our data indicates underperformance compared to the wider industry. Even so, earnings per share are more important to the intrinsic value of the business. With that said, earnings are more important to the long-term value of the business. 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.

With that in mind, we wouldn't be too quick to come to a conclusion on Sea1 Offshore. Long-term earnings power is much more important than next year's profits. We have estimates - from multiple Sea1 Offshore analysts - going out to 2027, and you can see them free on our platform here.

Don't forget that there may still be risks. For instance, we've identified 4 warning signs for Sea1 Offshore (1 is concerning) you should be aware of.

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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.