Analyst Forecasts For Continental Resources, Inc. (NYSE:CLR) Are Surging Higher

Continental Resources, Inc. (NYSE:CLR) shareholders will have a reason to smile today, with the analysts making substantial upgrades to this year's statutory forecasts. The consensus statutory numbers for both revenue and earnings per share (EPS) increased, with their view clearly much more bullish on the company's business prospects. The market seems to be pricing in some improvement in the business too, with the stock up 6.0% over the past week, closing at US$27.24. Whether the upgrade is enough to drive the stock price higher is yet to be seen, however.

After this upgrade, Continental Resources' 20 analysts are now forecasting revenues of US$4.8b in 2021. This would be a huge 72% improvement in sales compared to the last 12 months. The losses are expected to disappear over the next year or so, with forecasts for a profit of US$2.23 per share this year. Previously, the analysts had been modelling revenues of US$4.0b and earnings per share (EPS) of US$1.46 in 2021. There has definitely been an improvement in perception recently, with the analysts substantially increasing both their earnings and revenue estimates.

Check out our latest analysis for Continental Resources

With these upgrades, we're not surprised to see that the analysts have lifted their price target 5.8% to US$29.50 per share. 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 Continental Resources, with the most bullish analyst valuing it at US$35.00 and the most bearish at US$17.00 per share. Note the wide gap in analyst price targets? This implies to us that there is a fairly broad range of possible scenarios for the underlying 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. The analysts are definitely expecting Continental Resources' growth to accelerate, with the forecast 106% annualised growth to the end of 2021 ranking favourably alongside historical growth of 9.6% per annum over the past five years. Compare this with other companies in the same industry, which are forecast to grow their revenue 8.7% annually. It seems obvious that, while the growth outlook is brighter than the recent past, the analysts also expect Continental Resources to grow faster than the wider industry.

The Bottom Line

The biggest takeaway for us from these new estimates is that analysts upgraded their earnings per share estimates, with improved earnings power expected for this year. They also upgraded their revenue estimates for this year, and sales are expected to grow faster than the wider market. Given that the consensus looks almost universally bullish, with a substantial increase to forecasts and a higher price target, Continental Resources could be worth investigating further.

These earnings upgrades look like a sterling endorsement, but before diving in - you should know that we've spotted 4 potential flags with Continental Resources, including recent substantial insider selling. You can learn more, and discover the 2 other flags 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 that insiders are buying.

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