Forecast: Analysts Think Teekay Tankers Ltd.'s (NYSE:TNK) Business Prospects Have Improved Drastically

Shareholders in Teekay Tankers Ltd. (NYSE:TNK) may be thrilled to learn that the analysts have just delivered a major upgrade to their near-term 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 consensus from Teekay Tankers' six analysts is for revenues of US$655m in 2023, which would reflect a concerning 24% decline in sales compared to the last year of performance. Per-share earnings are expected to bounce 509% to US$7.69. Prior to this update, the analysts had been forecasting revenues of US$655m and earnings per share (EPS) of US$7.69 in 2023. So it's pretty clear that, although the analysts have updated their estimates, there's been no major change in expectations for the business.

See our latest analysis for Teekay Tankers

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. These estimates imply that sales are expected to slow, with a forecast annualised revenue decline of 19% by the end of 2023. This indicates a significant reduction from annual growth of 3.9% 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 7.2% annually for the foreseeable future. The forecasts do look bearish for Teekay Tankers, since they're expecting it to shrink faster than the industry.

The Bottom Line

The most important thing to take away is that there's been no major change in sentiment, with analysts reconfirming that earnings per share are expected to continue performing in line with their prior expectations. They also made no changes to their revenue estimates, implying there isn't much expectation of a major impact to the sales trajectory in the near term. More bullish expectations could be a signal for investors to take a closer look at Teekay Tankers.

Even so, the longer term trajectory of the business is much more important for the value creation of shareholders. We have estimates - from multiple Teekay Tankers analysts - 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.