Vår Energi AS Just Missed Earnings - But Analysts Have Updated Their Models

The analysts might have been a bit too bullish on Vår Energi AS (OB:VAR), given that the company fell short of expectations when it released its full-year results last week. Results showed a clear earnings miss, with US$7.5b revenue coming in 2.1% lower than what the analystsexpected. Statutory earnings per share (EPS) of US$0.11 missed the mark badly, arriving some 59% below what was expected. The analysts typically update their forecasts at each earnings report, and we can judge from their estimates whether their view of the company has changed or if there are any new concerns to be aware of. We thought readers would find it interesting to see the analysts latest (statutory) post-earnings forecasts for next year.

Check out our latest analysis for Vår Energi

Taking into account the latest results, the consensus forecast from Vår Energi's 13 analysts is for revenues of US$9.17b in 2025. This reflects a huge 23% improvement in revenue compared to the last 12 months. Statutory earnings per share are predicted to jump 230% to US$0.43. Before this earnings report, the analysts had been forecasting revenues of US$9.14b and earnings per share (EPS) of US$0.43 in 2025. The consensus analysts don't seem to have seen anything in these results that would have changed their view on the business, given there's been no major change to their estimates.

It will come as no surprise then, to learn that the consensus price target is largely unchanged at kr41.80. 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 kr46.22 and the most bearish at kr35.17 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. 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.

Taking a look at the bigger picture now, one of the ways we can understand these forecasts is to see how they compare to 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 23% annualised revenue growth to the end of 2025 noticeably faster than its historical growth of 12% p.a. over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in the same industry are forecast to see their revenue shrink 3.7% 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 most important thing to take away is that there's been no major change in sentiment, with the analysts reconfirming that the business is performing in line with their previous earnings per share estimates. Fortunately, they also reconfirmed their revenue estimates, suggesting that it's tracking in line with expectations. Their estimates also suggest that Vår Energi's revenue is expected to perform better than the wider industry. The consensus price target held steady at kr41.80, with the latest estimates not enough to have an impact on their price targets.

Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. We have forecasts for Vår Energi going out to 2027, and you can see them free on our platform here.

You should always think about risks though. Case in point, we've spotted 3 warning signs for Vår Energi you should be aware of, and 1 of them can't be ignored.

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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.