Vår Energi AS Earnings Missed Analyst Estimates: Here's What Analysts Are Forecasting Now

As you might know, Vår Energi AS (OB:VAR) recently reported its quarterly numbers. It was not a great result overall. While revenues of US$1.9b were in line with analyst predictions, earnings were less than expected, missing statutory estimates by 14% to hit US$0.08 per share. This is an important time for investors, as they can track a company's performance in its report, look at what experts are forecasting for next year, and see if there has been any change to expectations for the business. So we gathered the latest post-earnings forecasts to see what estimates suggest is in store for next year.

See our latest analysis for Vår Energi

After the latest results, the 13 analysts covering Vår Energi are now predicting revenues of US$8.08b in 2024. If met, this would reflect a decent 13% improvement in revenue compared to the last 12 months. Statutory earnings per share are predicted to shoot up 38% to US$0.34. Yet prior to the latest earnings, the analysts had been anticipated revenues of US$8.14b and earnings per share (EPS) of US$0.35 in 2024. So it looks like there's been a small decline in overall sentiment after the recent results - there's been no major change to revenue estimates, but the analysts did make a small dip in their earnings per share forecasts.

The consensus price target held steady at kr44.24, with the analysts seemingly voting that their lower forecast earnings are not expected to lead to a lower stock price in the foreseeable future. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. There are some variant perceptions on Vår Energi, with the most bullish analyst valuing it at kr53.12 and the most bearish at kr34.00 per share. We would probably assign less value to the analyst forecasts in this situation, because such a wide range of estimates could imply that the future of this business is difficult to value accurately. As a result it might not be a great idea to make decisions based on the consensus price target, which is after all just an average of this wide range of estimates.

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. It's clear from the latest estimates that Vår Energi's rate of growth is expected to accelerate meaningfully, with the forecast 27% annualised revenue growth to the end of 2024 noticeably faster than its historical growth of 3.4% p.a. over the past three years. By contrast, our data suggests that other companies (with analyst coverage) in the same industry are forecast to see their revenue shrink 6.2% per year. So it's clear with the acceleration in growth, Vår Energi is expected to grow meaningfully faster than the wider industry.

The Bottom Line

The biggest concern is that the analysts reduced their earnings per share estimates, suggesting business headwinds could lay ahead for Vår Energi. On the plus side, they made no changes to their revenue estimates - and they expect it 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.

With that in mind, we wouldn't be too quick to come to a conclusion on Vår Energi. Long-term earnings power is much more important than next year's profits. We have forecasts for Vår Energi going out to 2026, and you can see them free on our platform here.

Before you take the next step you should know about the 2 warning signs for Vår Energi (1 is a bit concerning!) that we have uncovered.

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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.

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