Analysts Are Betting On Avista Corporation (NYSE:AVA) With A Big Upgrade This Week

Avista Corporation (NYSE:AVA) shareholders will have a reason to smile today, with the analysts making substantial upgrades to this year's forecasts. The revenue forecast for this year has experienced a facelift, with analysts now much more optimistic on its sales pipeline.

Following the upgrade, the consensus from three analysts covering Avista is for revenues of US$1.8b in 2024, implying a small 7.9% decline in sales compared to the last 12 months. Statutory earnings per share are expected to be US$2.48, roughly flat on the last 12 months. Previously, the analysts had been modelling revenues of US$1.6b and earnings per share (EPS) of US$2.48 in 2024. There's clearly been a surge in bullishness around the company's sales pipeline, even if there's no real change in earnings per share forecasts.

Check out our latest analysis for Avista

The consensus price target increased 16% to US$46.33, with an improved revenue forecast carrying the promise of a more valuable business, in time.

One way to get more context on these forecasts is to look at how they compare to both past performance, and how other companies in the same industry are performing. These estimates imply that sales are expected to slow, with a forecast annualised revenue decline of 15% by the end of 2024. This indicates a significant reduction from annual growth of 8.1% 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 5.3% annually for the foreseeable future. So although its revenues are forecast to shrink, this cloud does not come with a silver lining - Avista is expected to lag the wider 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. Fortunately, they also upgraded their revenue estimates, and are forecasting revenues to grow slower than the wider market. There was also a nice increase in the price target, with analysts apparently feeling that the intrinsic value of the business is improving. Given that analysts appear to be expecting substantial improvement in the sales pipeline, now could be the right time to take another look at Avista.

Analysts are definitely bullish on Avista, but no company is perfect. Indeed, you should know that there are several potential concerns to be aware of, including dilutive stock issuance over the past year. You can learn more, and discover the 2 other risks we've identified, for 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 backed by insiders.

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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.