Bullish: Analysts Just Made A Huge Upgrade To Their CNX Resources Corporation (NYSE:CNX) Forecasts

CNX Resources Corporation (NYSE:CNX) shareholders will have a reason to smile today, with the analysts making substantial upgrades to this year's forecasts. The analysts greatly increased their revenue estimates, suggesting a stark improvement in business fundamentals.

After the upgrade, the consensus from CNX Resources' five analysts is for revenues of US$2.4b in 2023, which would reflect a substantial 33% decline in sales compared to the last year of performance. Statutory earnings per share are anticipated to plunge 48% to US$4.72 in the same period. Prior to this update, the analysts had been forecasting revenues of US$1.8b and earnings per share (EPS) of US$1.68 in 2023. 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 CNX Resources

Although the analysts have upgraded their earnings estimates, there was no change to the consensus price target of US$19.45, suggesting that the forecast performance does not have a long term impact on the company's valuation. That's not the only conclusion we can draw from this data however, as some investors also like to consider the spread in estimates when evaluating analyst price targets. The most optimistic CNX Resources analyst has a price target of US$28.00 per share, while the most pessimistic values it at US$15.00. This is a fairly broad spread of estimates, suggesting that the analysts are forecasting a wide range of possible outcomes for the business.

Another way we can view these estimates is in the context of the bigger picture, such as how the forecasts stack up against past performance, and whether forecasts are more or less bullish relative to other companies in the industry. We would highlight that sales are expected to reverse, with a forecast 42% annualised revenue decline to the end of 2023. That is a notable change from historical growth of 22% over the last five years. By contrast, our data suggests that other companies (with analyst coverage) in the industry are forecast to see their revenue decline 4.7% annually for the foreseeable future. The forecasts do look bearish for CNX Resources, since they're expecting it to shrink faster than the industry.

The Bottom Line

The most important thing to take away from this upgrade is that analysts upgraded their earnings per share estimates for this year, expecting improving business conditions. Notably, analysts also upgraded their revenue estimates, with sales performing well although CNX Resources' revenue growth is expected to trail that of the wider market. Some investors might be disappointed to see that the price target is unchanged, but we feel that improving fundamentals are usually a positive - assuming these forecasts are met! So CNX Resources could be a good candidate for more research.

These earnings upgrades look like a sterling endorsement, but before diving in - you should know that we've spotted 2 potential risk with CNX Resources, including a weak balance sheet. You can learn more, and discover the 1 other risk we've identified, for free on our platform here.

Another thing to consider is whether management and directors have been buying or selling stock recently. We provide an overview of all open market stock trades for the last twelve months on our platform, 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.