Earnings Update: ONE Gas, Inc. Beat Earnings And Now Analysts Have New Forecasts For This Year

ONE Gas, Inc. (NYSE:OGS) defied analyst predictions to release its first-quarter results, which were ahead of market expectations. Results were good overall, with revenues beating analyst predictions by 6.0% to hit US$935m. Statutory earnings per share (EPS) came in at US$1.98, some 6.7% above whatthe analysts had expected. Following the result, the analysts have updated their earnings model, and it would be good to know whether they think there's been a strong change in the company's prospects, or if it's business as usual. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether the analysts have changed their mind on ONE Gas after the latest results.

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Following last week's earnings report, ONE Gas' nine analysts are forecasting 2025 revenues to be US$2.28b, approximately in line with the last 12 months. Statutory earnings per share are predicted to accumulate 5.1% to US$4.26. In the lead-up to this report, the analysts had been modelling revenues of US$2.52b and earnings per share (EPS) of US$4.25 in 2025. So it looks like the analysts have become a bit less optimistic after the latest results announcement, with revenues expected to fall even as the company is supposed to maintain EPS.

View our latest analysis for ONE Gas

The average price target was steady at US$76.94even though revenue estimates declined; likely suggesting the analysts place a higher value on earnings. There's another way to think about price targets though, and that's to look at the range of price targets put forward by analysts, because a wide range of estimates could suggest a diverse view on possible outcomes for the business. There are some variant perceptions on ONE Gas, with the most bullish analyst valuing it at US$90.00 and the most bearish at US$66.00 per share. 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.

Of course, another way to look at these forecasts is to place them into context against the industry itself. We would highlight that ONE Gas' revenue growth is expected to slow, with the forecast 1.3% annualised growth rate until the end of 2025 being well below the historical 8.7% p.a. growth over the last five years. By way of comparison, the other companies in this industry with analyst coverage are forecast to grow their revenue at 5.3% per year. Factoring in the forecast slowdown in growth, it seems obvious that ONE Gas is also expected to grow slower than other industry participants.

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. Unfortunately, they also downgraded their revenue estimates, and our data indicates underperformance compared to the wider industry. Even so, earnings per share are more important to the intrinsic value of the business. Still, earnings are more important to the intrinsic value of the business. There was no real change to the consensus price target, suggesting that the intrinsic value of the business has not undergone any major changes with the latest estimates.

With that in mind, we wouldn't be too quick to come to a conclusion on ONE Gas. Long-term earnings power is much more important than next year's profits. At Simply Wall St, we have a full range of analyst estimates for ONE Gas going out to 2027, and you can see them free on our platform here..

Before you take the next step you should know about the 2 warning signs for ONE Gas (1 can't be ignored!) that we have uncovered.

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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.