ACWA POWER Company (TADAWUL:2082) Just Released Its Full-Year Results And Analysts Are Updating Their Estimates

Shareholders of ACWA POWER Company (TADAWUL:2082) will be pleased this week, given that the stock price is up 11% to ر.س277 following its latest full-year results. The result was positive overall - although revenues of ر.س6.1b were in line with what the analysts predicted, ACWA POWER surprised by delivering a statutory profit of ر.س2.27 per share, modestly greater than 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've gathered the most recent statutory forecasts to see whether the analysts have changed their earnings models, following these results.

See our latest analysis for ACWA POWER

Taking into account the latest results, the consensus forecast from ACWA POWER's four analysts is for revenues of ر.س8.64b in 2024. This reflects a substantial 42% improvement in revenue compared to the last 12 months. Per-share earnings are expected to grow 18% to ر.س2.69. Before this earnings report, the analysts had been forecasting revenues of ر.س8.61b and earnings per share (EPS) of ر.س2.97 in 2024. So it looks like there's been a small decline in overall sentiment after the recent results - there's been no major change to revenue estimates, but the analysts did make a small dip in their earnings per share forecasts.

It might be a surprise to learn that the consensus price target was broadly unchanged at ر.س171, with the analysts clearly implying that the forecast decline in earnings is not expected to have much of an impact on valuation. The consensus price target is just an average of individual analyst targets, so - it could be handy to see how wide the range of underlying estimates is. There are some variant perceptions on ACWA POWER, with the most bullish analyst valuing it at ر.س250 and the most bearish at ر.س80.00 per share. This is a fairly broad spread of estimates, suggesting that analysts are forecasting a wide range of possible outcomes for the business.

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. The analysts are definitely expecting ACWA POWER's growth to accelerate, with the forecast 42% annualised growth to the end of 2024 ranking favourably alongside historical growth of 8.0% per annum 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 9.9% per year. Factoring in the forecast acceleration in revenue, it's pretty clear that ACWA POWER is expected to grow much faster than its 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. Fortunately, they also reconfirmed their revenue numbers, suggesting that it's tracking in line with expectations. Additionally, our data suggests that revenue is expected to grow faster than the wider industry. The consensus price target held steady at ر.س171, with the latest estimates not enough to have an impact on their price targets.

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 ACWA POWER going out to 2026, and you can see them free on our platform here..

Don't forget that there may still be risks. For instance, we've identified 1 warning sign for ACWA POWER that you should be aware of.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

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.