Continental Resources, Inc. (NYSE:CLR) Annual Results: Here's What Analysts Are Forecasting For This Year
Continental Resources, Inc. (NYSE:CLR) came out with its annual results last week, and we wanted to see how the business is performing and what industry forecasters think of the company following this report. The results were mixed overall, with revenues slightly ahead of analyst estimates at US$2.8b. Statutory losses by contrast were 9.3% larger than predictions at US$1.65 per share. This is an important time for investors, as they can track a company's performance in its report, look at what experts are forecasting for next year, and see if there has been any change to expectations for the business. We thought readers would find it interesting to see the analysts latest (statutory) post-earnings forecasts for next year.
Check out our latest analysis for Continental Resources
Taking into account the latest results, the current consensus from Continental Resources' 19 analysts is for revenues of US$3.45b in 2021, which would reflect a substantial 25% increase on its sales over the past 12 months. Continental Resources is also expected to turn profitable, with statutory earnings of US$0.49 per share. Before this earnings report, the analysts had been forecasting revenues of US$3.45b and earnings per share (EPS) of US$0.49 in 2021. So it's pretty clear that, although the analysts have updated their estimates, there's been no major change in expectations for the business following the latest results.
It will come as no surprise then, to learn that the consensus price target is largely unchanged at US$21.61. 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. The most optimistic Continental Resources analyst has a price target of US$27.00 per share, while the most pessimistic values it at US$14.00. Note the wide gap in analyst price targets? This implies to us that there is a fairly broad range of possible scenarios for the underlying business.
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. It's clear from the latest estimates that Continental Resources' rate of growth is expected to accelerate meaningfully, with the forecast 25% revenue growth noticeably faster than its historical growth of 15%p.a. over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to grow their revenue at 11% per year. Factoring in the forecast acceleration in revenue, it's pretty clear that Continental Resources is expected to grow much faster than its industry.
The Bottom Line
The most important thing to take away is that there's been no major change in sentiment, with the analysts reconfirming that the business is performing in line with their previous earnings per share estimates. Happily, there were no major changes to revenue forecasts, with the business still expected to grow faster than the wider industry. 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 Continental Resources. Long-term earnings power is much more important than next year's profits. We have forecasts for Continental Resources going out to 2025, and you can see them free on our platform here.
You still need to take note of risks, for example - Continental Resources has 2 warning signs we think you should be aware of.
This article by Simply Wall St is general in nature. 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.
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