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Earnings Release: Here's Why Analysts Cut Their Hallador Energy Company (NASDAQ:HNRG) Price Target To US$4.00

Simply Wall St
·3 min read

Shareholders might have noticed that Hallador Energy Company (NASDAQ:HNRG) filed its first-quarter result this time last week. The early response was not positive, with shares down 5.6% to US$0.66 in the past week. The results were positive, with revenue coming in at US$63m, beating analyst expectations by 4.4%. The analyst typically update their forecasts at each earnings report, and we can judge from their estimates whether their view of the company has changed or if there are any new concerns to be aware of. So we gathered the latest post-earnings forecasts to see what estimate suggests is in store for next year.

See our latest analysis for Hallador Energy

NasdaqCM:HNRG Past and Future Earnings May 14th 2020
NasdaqCM:HNRG Past and Future Earnings May 14th 2020

Taking into account the latest results, the current consensus, from the single analyst covering Hallador Energy, is for revenues of US$264.3m in 2020, which would reflect a chunky 9.1% reduction in Hallador Energy's sales over the past 12 months. Before this earnings result, the analyst had predicted US$259.7m revenue in 2020, although there was no accompanying EPS estimate. Overall it looks like Hallador Energy is performing in line with expectations, giventhe analyst has updated their numbers and there's been no real change to next year's forecast following these results.

The average price target fell 20% to US$4.00, withthe analyst clearly having become less optimistic about Hallador Energy'sprospects following its latest earnings.

Taking a look at the bigger picture now, one of the ways we can understand these forecasts is to see how they compare to both past performance and industry growth estimates. One more thing stood out to us about these estimates, and it's the idea that Hallador Energy'sdecline is expected to accelerate, with revenues forecast to fall 9.1% next year, topping off a historical decline of 1.7% a year over the past five years. Compare this against analyst estimates for companies in the wider industry, which suggest that revenues (in aggregate) are expected to grow 8.4% next year. So it's pretty clear that, while it does have declining revenues, the analyst also expect Hallador Energy to suffer worse than the wider industry.

The Bottom Line

The most important thing to take away is that the analyst reconfirmed their revenue estimates for next year, suggesting that the business is performing in line with expectations. On the plus side, there were no major changes to revenue estimates; although forecasts imply revenues will perform worse than the wider industry. The consensus price target fell measurably, with the analyst seemingly not reassured by the latest results, leading to a lower estimate of Hallador Energy's future valuation.

We have estimates for Hallador Energy from one covering analyst, and you can see them free on our platform here.

You still need to take note of risks, for example - Hallador Energy has 4 warning signs (and 1 which can't be ignored) we think you should know about.

If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.com. 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. Simply Wall St has no position in the stocks mentioned.

We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Thank you for reading.