Industry Analysts Just Made A Notable Upgrade To Their Constellation Energy Corporation (NASDAQ:CEG) Revenue Forecasts

Shareholders in Constellation Energy Corporation (NASDAQ:CEG) may be thrilled to learn that the analysts have just delivered a major upgrade to their near-term forecasts. The analysts have sharply increased their revenue numbers, with a view that Constellation Energy will make substantially more sales than they'd previously expected.

Following the upgrade, the consensus from eight analysts covering Constellation Energy is for revenues of US$21b in 2023, implying an uncomfortable 13% decline in sales compared to the last 12 months. Losses are expected to turn into profits real soon, with the analysts forecasting US$4.30 in per-share earnings. Previously, the analysts had been modelling revenues of US$19b and earnings per share (EPS) of US$4.12 in 2023. The forecasts seem more optimistic now, with a nice increase in revenue and a modest lift to earnings per share estimates.

View our latest analysis for Constellation Energy

Despite these upgrades, the analysts have not made any major changes to their price target of US$98.00, suggesting that the higher estimates are not likely to have a long term impact on what the stock is worth. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. Currently, the most bullish analyst values Constellation Energy at US$115 per share, while the most bearish prices it at US$88.00. With such a narrow range of valuations, analysts apparently share similar views on what they think the business is worth.

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Constellation Energy's past performance and to peers in the same industry. These estimates imply that sales are expected to slow, with a forecast annualised revenue decline of 13% by the end of 2023. This indicates a significant reduction from annual growth of 2.0% over the last five years. By contrast, our data suggests that other companies (with analyst coverage) in the same industry are forecast to see their revenue grow 3.3% annually for the foreseeable future. It's pretty clear that Constellation Energy's revenues are expected to perform substantially worse than the wider 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. Fortunately, they also upgraded their revenue estimates, and are forecasting revenues to grow slower than the wider market. Seeing the dramatic upgrade to this year's forecasts, it might be time to take another look at Constellation Energy.

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 Constellation Energy going out to 2025, and you can see them free on our platform here..

Of course, seeing company management invest large sums of money in a stock can be just as useful as knowing whether analysts are upgrading their estimates. So you may also wish to search this free list of stocks 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.