Vår Energi AS (OB:VAR) Just Reported Third-Quarter Earnings: Have Analysts Changed Their Mind On The Stock?

It's been a good week for Vår Energi AS (OB:VAR) shareholders, because the company has just released its latest quarterly results, and the shares gained 3.3% to kr35.92. Revenues of US$1.9b were in line with forecasts, although statutory earnings per share (EPS) came in below expectations at US$0.07, missing estimates by 4.7%. Earnings are an important time for investors, as they can track a company's performance, look at what the analysts are forecasting for next year, and see if there's been a change in sentiment towards the company. With this in mind, we've gathered the latest statutory forecasts to see what the analysts are expecting 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$9.46b in 2025. This reflects a substantial 28% improvement in revenue compared to the last 12 months. Per-share earnings are expected to shoot up 96% to US$0.45. Before this earnings report, the analysts had been forecasting revenues of US$9.63b and earnings per share (EPS) of US$0.48 in 2025. The analysts seem to have become a little more negative on the business after the latest results, given the minor downgrade to their earnings per share numbers for next year.

The consensus price target held steady at kr42.29, 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. The most optimistic Vår Energi analyst has a price target of kr48.34 per share, while the most pessimistic values it at kr33.75. So we wouldn't be assigning too much credibility to analyst price targets in this case, because there are clearly some widely different views on what kind of performance this business can generate. 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. The analysts are definitely expecting Vår Energi's growth to accelerate, with the forecast 22% annualised growth to the end of 2025 ranking favourably alongside historical growth of 14% per annum 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 5.4% 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 the analysts downgraded their earnings per share estimates, showing that there has been a clear decline in sentiment following these results. 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.

Following on from that line of thought, we think that the long-term prospects of the business are much more relevant than next year's earnings. We have estimates - from multiple Vår Energi analysts - going out to 2026, and you can see them free on our platform here.

That said, it's still necessary to consider the ever-present spectre of investment risk. We've identified 3 warning signs with Vår Energi (at least 1 which is potentially serious) , and understanding them should be part of your investment process.

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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.