Growth Investors: Industry Analysts Just Upgraded Their Centrica plc (LON:CNA) Revenue Forecasts By 36%
Centrica plc (LON:CNA) shareholders will have a reason to smile today, with the analysts making substantial upgrades to this year's forecasts. The analysts have sharply increased their revenue numbers, with a view that Centrica will make substantially more sales than they'd previously expected.
Following the latest upgrade, the current consensus, from the eleven analysts covering Centrica, is for revenues of UK£24b in 2024, which would reflect a perceptible 7.9% reduction in Centrica's sales over the past 12 months. Prior to the latest estimates, the analysts were forecasting revenues of UK£18b in 2024. The consensus has definitely become more optimistic, showing a considerable lift to revenue forecasts.
See our latest analysis for Centrica
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. These estimates imply that sales are expected to slow, with a forecast annualised revenue decline of 7.9% by the end of 2024. This indicates a significant reduction from annual growth of 8.9% 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 0.3% annually for the foreseeable future. It's pretty clear that Centrica's revenues are expected to perform substantially worse than the wider industry.
The Bottom Line
The most important thing to take away from this upgrade is that analysts lifted their revenue estimates for this year. They're also anticipating slower revenue growth than the wider market. Seeing the dramatic upgrade to this year's forecasts, it might be time to take another look at Centrica.
These earnings upgrades look like a sterling endorsement, but before diving in - you should know that we've spotted 3 potential warning sign with Centrica, including concerns around earnings quality. You can learn more, and discover the 1 other warning sign we've identified, for free on our platform here.
Of course, seeing company management invest large sums of money in a stock can be just as useful as knowing whether analysts are upgrading their estimates. So you may also wish to search this free list of stocks that insiders are buying.
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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.
