Analysts Are Updating Their Saudi Arabian Oil Company (TADAWUL:2222) Estimates After Its Yearly Results

As you might know, Saudi Arabian Oil Company (TADAWUL:2222) recently reported its annual numbers. Saudi Arabian Oil reported in line with analyst predictions, delivering revenues of ر.س1.9t and statutory earnings per share of ر.س1.87, suggesting the business is executing well and in line with its plan. 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.

View our latest analysis for Saudi Arabian Oil

Taking into account the latest results, the twelve analysts covering Saudi Arabian Oil provided consensus estimates of ر.س1.74t revenue in 2024, which would reflect a noticeable 6.1% decline over the past 12 months. Statutory per-share earnings are expected to be ر.س1.88, roughly flat on the last 12 months. In the lead-up to this report, the analysts had been modelling revenues of ر.س1.75t and earnings per share (EPS) of ر.س1.88 in 2024. So it's pretty clear that, although the analysts have updated their estimates, there's been no major change in expectations for the business following the latest results.

There were no changes to revenue or earnings estimates or the price target of ر.س33.80, suggesting that the company has met expectations in its recent result. 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. There are some variant perceptions on Saudi Arabian Oil, with the most bullish analyst valuing it at ر.س38.00 and the most bearish at ر.س31.00 per share. This is a very narrow spread of estimates, implying either that Saudi Arabian Oil is an easy company to value, or - more likely - the analysts are relying heavily on some key assumptions.

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. These estimates imply that revenue is expected to slow, with a forecast annualised decline of 6.1% by the end of 2024. This indicates a significant reduction from annual growth of 14% over the last five years. Yet aggregate analyst estimates for other companies in the industry suggest that industry revenues are forecast to decline 1.2% per year. The forecasts do look bearish for Saudi Arabian Oil, since they're expecting it to shrink faster than the industry.

The Bottom Line

The most obvious conclusion is that there's been no major change in the business' prospects in recent times, with the analysts holding their earnings forecasts steady, in line with previous estimates. They also made no changes to their revenue estimates, implying the business is not expected to experience any major impacts to the current trajectory in the near term, even though it is expected to trail 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 Saudi Arabian Oil. Long-term earnings power is much more important than next year's profits. We have estimates - from multiple Saudi Arabian Oil analysts - going out to 2026, and you can see them free on our platform here.

Plus, you should also learn about the 1 warning sign we've spotted with Saudi Arabian Oil .

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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.