Civeo Corporation Just Beat Analyst Forecasts, And Analysts Have Been Updating Their Predictions
As you might know, Civeo Corporation (NYSE:CVEO) just kicked off its latest full-year results with some very strong numbers. It was overall a positive result, with revenues beating expectations by 2.9% to hit US$701m. Civeo also reported a statutory profit of US$2.01, which was an impressive 1,240% above what the analysts had forecast. 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 Civeo after the latest results.
View our latest analysis for Civeo
Following the recent earnings report, the consensus from three analysts covering Civeo is for revenues of US$652.1m in 2024. This implies a noticeable 7.0% decline in revenue compared to the last 12 months. Statutory earnings per share are forecast to dive 70% to US$0.61 in the same period. Before this earnings announcement, the analysts had been modelling revenues of US$630.0m and losses of US$0.26 per share in 2024. The analysts have definitely been lifting their expectations, with the company expected to reach profitability next year - sooner than expected - thanks to the modest lift to revenue expectations.
Althoughthe analysts have upgraded their earnings estimates, there was no change to the consensus price target of US$31.50, suggesting that the forecast performance does not have a long term impact on the company's valuation. The consensus price target is just an average of individual analyst targets, so - it could be handy to see how wide the range of underlying estimates is. Currently, the most bullish analyst values Civeo at US$33.00 per share, while the most bearish prices it at US$30.00. With such a narrow range of valuations, the analysts apparently share similar views on what they think the business is worth.
Looking at the bigger picture now, one of the ways we can make sense of these forecasts is to see how they measure up against both past performance and industry growth estimates. We would highlight that revenue is expected to reverse, with a forecast 7.0% annualised decline to the end of 2024. That is a notable change from historical growth of 9.0% 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 6.3% annually for the foreseeable future. It's pretty clear that Civeo's revenues are expected to perform substantially worse than the wider industry.
The Bottom Line
The most important thing to take away is that the analysts now expect Civeo to become profitable next year, compared to previous expectations that it would report a loss. They also upgraded their revenue estimates for next year, even though it is expected to grow slower than the wider industry. The consensus price target held steady at US$31.50, with the latest estimates not enough to have an impact on their price targets.
Following on from that line of thought, we think that 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 Civeo going out to 2026, and you can see them free on our platform here..
Before you take the next step you should know about the 3 warning signs for Civeo (1 is significant!) 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.
