Rainbows and Unicorns: Continental Resources, Inc. (NYSE:CLR) Analysts Just Became A Lot More Optimistic

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. Consensus estimates suggest investors could expect greatly increased statutory revenues and earnings per share, with the analysts modelling a real improvement in business performance.

After the upgrade, the 16 analysts covering Continental Resources are now predicting revenues of US$9.4b in 2022. If met, this would reflect a major 72% improvement in sales compared to the last 12 months. Statutory earnings per share are presumed to shoot up 145% to US$11.38. Previously, the analysts had been modelling revenues of US$8.6b and earnings per share (EPS) of US$10.00 in 2022. So it seems there's been a definite increase in optimism about Continental Resources' future following the latest consensus numbers, with a nice gain to the earnings per share forecasts in particular.

See our latest analysis for Continental Resources

It will come as no surprise to learn that the analysts have increased their price target for Continental Resources 6.2% to US$74.19 on the back of these upgrades. 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$102 and the most bearish at US$54.00 per share. 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 Continental Resources' rate of growth is expected to accelerate meaningfully, with the forecast 72% annualised revenue growth to the end of 2022 noticeably faster than its historical growth of 9.4% p.a. over the past five years. Compare this with other companies in the same industry, which are forecast to grow their revenue 5.4% 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. Fortunately, analysts also upgraded their revenue estimates, and our data indicates sales are expected to perform better than the wider market. With a serious upgrade to expectations and a rising price target, it might be time to take another look at Continental Resources.

Analysts are clearly in love with Continental Resources at the moment, but before diving in - you should be aware that we've identified some warning flags with the business, such as a weak balance sheet. You can learn more, and discover the 2 other concerns we've identified, for free on our platform here.

We also provide an overview of the Continental Resources Board and CEO remuneration and length of tenure at the company, and whether insiders have been buying the stock, here.

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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.