News Flash: Analysts Just Made A Notable Upgrade To Their Genesis Energy Limited (NZSE:GNE) Forecasts

Shareholders in Genesis Energy Limited (NZSE:GNE) may be thrilled to learn that the analysts have just delivered a major upgrade to their near-term forecasts. The consensus estimated revenue numbers rose, with their view now clearly much more bullish on the company's business prospects.

Following the upgrade, the most recent consensus for Genesis Energy from its four analysts is for revenues of NZ$3.6b in 2025 which, if met, would be a decent 17% increase on its sales over the past 12 months. Statutory earnings per share are supposed to plunge 25% to NZ$0.091 in the same period. Prior to this update, the analysts had been forecasting revenues of NZ$3.1b and earnings per share (EPS) of NZ$0.09 in 2025. There's clearly been a surge in bullishness around the company's sales pipeline, even if there's no real change in earnings per share forecasts.

View our latest analysis for Genesis Energy

Even though revenue forecasts increased, there was no change to the consensus price target of NZ$2.55, suggesting the analysts are focused on earnings as the driver of value creation.

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. For example, we noticed that Genesis Energy's rate of growth is expected to accelerate meaningfully, with revenues forecast to exhibit 17% growth to the end of 2025 on an annualised basis. That is well above its historical decline of 0.2% a year over the past five years. Compare this against analyst estimates for the broader industry, which suggest that (in aggregate) industry revenues are expected to grow 0.07% annually. Not only are Genesis Energy's revenues expected to improve, it seems that the analysts are also expecting it to grow faster than the wider industry.

The Bottom Line

The most obvious conclusion from this consensus update is that there's been no major change in the business' prospects in recent times, with analysts holding earnings per share steady, in line with previous estimates. They also upgraded their revenue estimates for this year, and sales are expected to grow faster than the wider market. Given that analysts appear to be expecting substantial improvement in the sales pipeline, now could be the right time to take another look at Genesis Energy.

These earnings upgrades look like a sterling endorsement, but before diving in - you should know that we've spotted 3 potential warning signs with Genesis Energy, including its declining profit margins. You can learn more, and discover the 2 other warning signs we've identified, for free on our platform here.

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 with high insider ownership.

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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.