Earnings Update: The AES Corporation (NYSE:AES) Just Reported Its Third-Quarter Results And Analysts Are Updating Their Forecasts

There's been a notable change in appetite for The AES Corporation (NYSE:AES) shares in the week since its quarterly report, with the stock down 14% to US$14.71. Results look mixed - while revenue fell marginally short of analyst estimates at US$3.3b, statutory earnings were in line with expectations, at US$0.35 per share. The analysts typically update their forecasts at each earnings report, and we can judge from their estimates whether their view of the company has changed or if there are any new concerns to be aware of. We've gathered the most recent statutory forecasts to see whether the analysts have changed their earnings models, following these results.

Check out our latest analysis for AES

Taking into account the latest results, the most recent consensus for AES from nine analysts is for revenues of US$13.4b in 2025. If met, it would imply a decent 9.3% increase on its revenue over the past 12 months. Per-share earnings are expected to soar 43% to US$2.07. Before this earnings report, the analysts had been forecasting revenues of US$13.4b and earnings per share (EPS) of US$2.07 in 2025. The consensus analysts don't seem to have seen anything in these results that would have changed their view on the business, given there's been no major change to their estimates.

There were no changes to revenue or earnings estimates or the price target of US$21.76, suggesting that the company has met expectations in its recent result. Fixating on a single price target can be unwise though, since the consensus target is effectively the average of analyst price targets. As a result, some investors like to look at the range of estimates to see if there are any diverging opinions on the company's valuation. Currently, the most bullish analyst values AES at US$25.00 per share, while the most bearish prices it at US$16.00. 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.

Taking a look at the bigger picture now, one of the ways we can understand these forecasts is to see how they compare to both past performance and industry growth estimates. The period to the end of 2025 brings more of the same, according to the analysts, with revenue forecast to display 7.4% growth on an annualised basis. That is in line with its 6.4% annual growth over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to see their revenues grow 9.9% per year. So it's pretty clear that AES is expected to grow slower than similar companies in the same industry.

The Bottom Line

The most obvious conclusion is that there's been no major change in the business' prospects in recent times, with the analysts holding their earnings forecasts steady, in line with previous estimates. Fortunately, the analysts also reconfirmed their revenue estimates, suggesting that it's tracking in line with expectations. Although our data does suggest that AES' revenue is expected to perform worse than the wider industry. The consensus price target held steady at US$21.76, with the latest estimates not enough to have an impact on their price targets.

With that in mind, we wouldn't be too quick to come to a conclusion on AES. Long-term earnings power is much more important than next year's profits. We have estimates - from multiple AES analysts - going out to 2026, and you can see them free on our platform here.

You still need to take note of risks, for example - AES has 4 warning signs (and 1 which shouldn't be ignored) we think you should know about.

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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.