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New Forecasts: Here's What Analysts Think The Future Holds For Brigham Minerals, Inc. (NYSE:MNRL)

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Shareholders in Brigham Minerals, Inc. (NYSE:MNRL) may be thrilled to learn that the analysts have just delivered a major upgrade to their near-term forecasts. Consensus estimates suggest investors could expect greatly increased statutory revenues and earnings per share, with the analysts modelling a real improvement in business performance.

Following the upgrade, the most recent consensus for Brigham Minerals from its seven analysts is for revenues of US$129m in 2021 which, if met, would be a huge 41% increase on its sales over the past 12 months. The losses are expected to disappear over the next year or so, with forecasts for a profit of US$0.49 per share this year. Before this latest update, the analysts had been forecasting revenues of US$118m and earnings per share (EPS) of US$0.39 in 2021. So we can see there's been a pretty clear increase in analyst sentiment in recent times, with both revenues and earnings per share receiving a decent lift in the latest estimates.

Check out our latest analysis for Brigham Minerals

earnings-and-revenue-growth
earnings-and-revenue-growth

Despite these upgrades, the analysts have not made any major changes to their price target of US$17.20, suggesting that the higher estimates are not likely to have a long term impact on what the stock is worth. Fixating on a single price target can be unwise though, since the consensus target is effectively the average of analyst price targets. As a result, some investors like to look at the range of estimates to see if there are any diverging opinions on the company's valuation. Currently, the most bullish analyst values Brigham Minerals at US$20.00 per share, while the most bearish prices it at US$14.00. This shows there is still some diversity in estimates, but analysts don't appear to be totally split on the stock as though it might be a success or failure situation.

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. The analysts are definitely expecting Brigham Minerals' growth to accelerate, with the forecast 41% annualised growth to the end of 2021 ranking favourably alongside historical growth of 25% per annum over the past three years. Compare this with other companies in the same industry, which are forecast to grow their revenue 9.6% annually. Factoring in the forecast acceleration in revenue, it's pretty clear that Brigham Minerals is expected to grow much faster than its industry.

The Bottom Line

The most important thing to take away from this upgrade is that analysts upgraded their earnings per share estimates for this year, expecting improving business conditions. They also upgraded their revenue estimates for this year, and sales are expected to grow faster than the wider market. Some investors might be disappointed to see that the price target is unchanged, but we feel that improving fundamentals are usually a positive - assuming these forecasts are met! So Brigham Minerals could be a good candidate for more research.

Analysts are definitely bullish on Brigham Minerals, but no company is perfect. Indeed, you should know that there are several potential concerns to be aware of, including the risk of cutting its dividend. You can learn more, and discover the 1 other risk we've identified, for free on our platform here.

Another way to search for interesting companies that could be reaching an inflection point is to track whether management are buying or selling, with our free list of growing companies that insiders are buying.

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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.