Ranger Energy Services, Inc. Just Missed EPS By 20%: Here's What Analysts Think Will Happen Next

It's been a good week for Ranger Energy Services, Inc. (NYSE:RNGR) shareholders, because the company has just released its latest annual results, and the shares gained 2.2% to US$10.94. It looks like a pretty bad result, all things considered. Although revenues of US$637m were in line with analyst predictions, statutory earnings fell badly short, missing estimates by 20% to hit US$0.95 per share. This is an important time for investors, as they can track a company's performance in its report, look at what experts are forecasting for next year, and see if there has been any change to expectations for the business. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether the analysts have changed their mind on Ranger Energy Services after the latest results.

View our latest analysis for Ranger Energy Services

Taking into account the latest results, Ranger Energy Services' two analysts currently expect revenues in 2024 to be US$643.3m, approximately in line with the last 12 months. Per-share earnings are expected to step up 13% to US$1.19. Yet prior to the latest earnings, the analysts had been anticipated revenues of US$645.2m and earnings per share (EPS) of US$1.52 in 2024. So there's definitely been a decline in sentiment after the latest results, noting the pretty serious reduction to new EPS forecasts.

It might be a surprise to learn that the consensus price target fell 5.2% to US$13.75, with the analysts clearly linking lower forecast earnings to the performance of the stock price.

Of course, another way to look at these forecasts is to place them into context against the industry itself. We would highlight that Ranger Energy Services' revenue growth is expected to slow, with the forecast 1.1% annualised growth rate until the end of 2024 being well below the historical 20% p.a. growth over the last five years. Compare this against other companies (with analyst forecasts) in the industry, which are in aggregate expected to see revenue growth of 7.5% annually. So it's pretty clear that, while revenue growth is expected to slow down, the wider industry is also expected to grow faster than Ranger Energy Services.

The Bottom Line

The biggest concern is that the analysts reduced their earnings per share estimates, suggesting business headwinds could lay ahead for Ranger Energy Services. Fortunately, the analysts also reconfirmed their revenue estimates, suggesting that it's tracking in line with expectations. Although our data does suggest that Ranger Energy Services' revenue is expected to perform worse than the wider industry. Furthermore, the analysts also cut their price targets, suggesting that the latest news has led to greater pessimism about the intrinsic value of the business.

With that in mind, we wouldn't be too quick to come to a conclusion on Ranger Energy Services. Long-term earnings power is much more important than next year's profits. At least one analyst has provided forecasts out to 2025, which can be seen for free on our platform here.

It is also worth noting that we have found 1 warning sign for Ranger Energy Services that you need to take into consideration.

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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.