Earnings Beat: Vistra Corp. (NYSE:VST) Just Beat Analyst Forecasts, And Analysts Have Been Lifting Their Forecasts
Shareholders of Vistra Corp. (NYSE:VST) will be pleased this week, given that the stock price is up 12% to US$54.50 following its latest yearly results. Revenues were US$15b, with Vistra reporting some 5.0% below analyst expectations. 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. So we gathered the latest post-earnings forecasts to see what estimates suggest is in store for next year.
View our latest analysis for Vistra
Following the latest results, Vistra's five analysts are now forecasting revenues of US$17.4b in 2024. This would be a notable 17% improvement in revenue compared to the last 12 months. Per-share earnings are expected to grow 15% to US$4.44. Yet prior to the latest earnings, the analysts had been anticipated revenues of US$16.3b and earnings per share (EPS) of US$3.85 in 2024. So it seems there's been a definite increase in optimism about Vistra's future following the latest results, with a solid gain to the earnings per share forecasts in particular.
With these upgrades, we're not surprised to see that the analysts have lifted their price target 6.5% to US$49.00per share. 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 Vistra analyst has a price target of US$62.00 per share, while the most pessimistic values it at US$26.00. 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.
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. The analysts are definitely expecting Vistra's growth to accelerate, with the forecast 17% annualised growth to the end of 2024 ranking favourably alongside historical growth of 7.5% per annum 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 2.5% per year. Factoring in the forecast acceleration in revenue, it's pretty clear that Vistra is expected to grow much faster than its industry.
The Bottom Line
The biggest takeaway for us is the consensus earnings per share upgrade, which suggests a clear improvement in sentiment around Vistra's earnings potential next year. Pleasantly, they also upgraded their revenue estimates, and their forecasts suggest the business is expected to grow faster than the wider industry. We note an upgrade to the price target, suggesting that the analysts believes the intrinsic value of the business is likely to improve over time.
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. We have estimates - from multiple Vistra analysts - 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 Vistra (1 shouldn'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.
