Analysts Are Betting On ENEA S.A. (WSE:ENA) With A Big Upgrade This Week

ENEA S.A. (WSE:ENA) shareholders will have a reason to smile today, with the analysts making substantial upgrades to this year's forecasts. The analysts have sharply increased their revenue numbers, with a view that ENEA will make substantially more sales than they'd previously expected.

After the upgrade, the six analysts covering ENEA are now predicting revenues of zł33b in 2022. If met, this would reflect a major 40% improvement in sales compared to the last 12 months. Statutory earnings per share are anticipated to plunge 21% to zł3.18 in the same period. Prior to this update, the analysts had been forecasting revenues of zł29b and earnings per share (EPS) of zł3.17 in 2022. It seems analyst sentiment has certainly become more bullish on revenues, even though they haven't changed their view on earnings per share.

See our latest analysis for ENEA

Even though revenue forecasts increased, there was no change to the consensus price target of zł14.20, suggesting the analysts are focused on earnings as the driver of value creation. There's another way to think about price targets though, and that's to look at the range of price targets put forward by analysts, because a wide range of estimates could suggest a diverse view on possible outcomes for the business. Currently, the most bullish analyst values ENEA at zł21.40 per share, while the most bearish prices it at zł8.30. This is a fairly broad spread of estimates, suggesting that the analysts are forecasting a wide range of possible outcomes for 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 ENEA's rate of growth is expected to accelerate meaningfully, with the forecast 57% annualised revenue growth to the end of 2022 noticeably faster than its historical growth of 15% p.a. over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to grow their revenue at 1.3% per year. Factoring in the forecast acceleration in revenue, it's pretty clear that ENEA is expected to grow much faster than its industry.

The Bottom Line

The most important thing to take away is that there's been no major change in sentiment, with analysts reconfirming that earnings per share are expected to continue performing in line with their prior expectations. Fortunately, analysts also upgraded their revenue estimates, and our data indicates sales are expected to perform better than the wider market. Seeing the dramatic upgrade to this year's forecasts, it might be time to take another look at ENEA.

With that said, the long-term trajectory of the company's earnings is a lot more important than next year. At Simply Wall St, we have a full range of analyst estimates for ENEA going out to 2024, and you can see them free on our platform here..

Another way to search for interesting companies that could be reaching an inflection point is to track whether management are buying or selling, with our free list of growing companies that insiders are buying.

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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.