Brokers Are Upgrading Their Views On EQT Corporation (NYSE:EQT) With These New Forecasts

EQT Corporation (NYSE:EQT) 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.

Following the latest upgrade, the 13 analysts covering EQT provided consensus estimates of US$5.9b revenue in 2022, which would reflect a painful 43% decline on its sales over the past 12 months. Losses are expected to turn into profits real soon, with the analysts forecasting US$0.46 in per-share earnings. However, before this estimates update, the consensus had been expecting revenues of US$5.2b and US$1.05 per share in losses. It looks like there's been a definite improvement in business conditions, with a revenue upgrade supposed to lead to profitability sooner than previously forecast.

View our latest analysis for EQT

Although the analysts have upgraded their earnings estimates, there was no change to the consensus price target of US$55.67, 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. Currently, the most bullish analyst values EQT at US$78.00 per share, while the most bearish prices it at US$45.00. There are definitely some different views on the stock, but the range of estimates is not wide enough as to imply that the situation is unforecastable, in our view.

Of course, another way to look at these forecasts is to place them into context against the industry itself. These estimates imply that sales are expected to slow, with a forecast annualised revenue decline of 67% by the end of 2022. This indicates a significant reduction from annual growth of 18% over the last five years. Yet aggregate analyst estimates for other companies in the industry suggest that industry revenues are forecast to decline 5.1% per year. The forecasts do look bearish for EQT, 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 the consensus now expects EQT to become profitable this year. Notably, analysts also upgraded their revenue estimates, with sales performing well although EQT's revenue growth is expected to trail that of the wider market. The lack of change in the price target is puzzling, but with a serious upgrade to this year's earnings expectations, it might be time to take another look at EQT.

Still, the long-term prospects of the business are much more relevant than next year's earnings. At Simply Wall St, we have a full range of analyst estimates for EQT going out to 2024, and you can see them free on our platform here..

Another way to search for interesting companies that could be reaching an inflection point is to track whether management are buying or selling, with our free list of growing companies that insiders are buying.

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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.