News Flash: Analysts Just Made A Notable Upgrade To Their Kinetik Holdings Inc. (NYSE:KNTK) Forecasts
Kinetik Holdings Inc. (NYSE:KNTK) shareholders will have a reason to smile today, with the analysts making substantial upgrades to this year's statutory forecasts. The analysts have sharply increased their revenue numbers, with a view that Kinetik Holdings will make substantially more sales than they'd previously expected.
Following the upgrade, the consensus from three analysts covering Kinetik Holdings is for revenues of US$945m in 2023, implying a disturbing 22% decline in sales compared to the last 12 months. Prior to the latest estimates, the analysts were forecasting revenues of US$785m in 2023. It looks like there's been a clear increase in optimism around Kinetik Holdings, given the great increase in revenue forecasts.
View our latest analysis for Kinetik Holdings
We'd point out that there was no major changes to their price target of US$36.13, suggesting the latest estimates were not enough to shift their view on the value of the business. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. Currently, the most bullish analyst values Kinetik Holdings at US$41.00 per share, while the most bearish prices it at US$34.00. Still, with such a tight range of estimates, it suggests the analysts have a pretty good idea of what they think the company is worth.
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. These estimates imply that sales are expected to slow, with a forecast annualised revenue decline of 22% by the end of 2023. This indicates a significant reduction from annual growth of 38% over the last three years. By contrast, our data suggests that other companies (with analyst coverage) in the industry are forecast to see their revenue decline 5.9% annually for the foreseeable future. The forecasts do look bearish for Kinetik Holdings, since they're expecting it to shrink faster than the industry.
The Bottom Line
The highlight for us was that analysts increased their revenue forecasts for Kinetik Holdings this year. Analysts also expect revenues to shrink faster than the wider market. Seeing the dramatic upgrade to this year's forecasts, it might be time to take another look at Kinetik Holdings.
Analysts are clearly in love with Kinetik Holdings at the moment, but before diving in - you should be aware that we've identified some warning flags with the business, such as the risk of cutting its dividend. For more information, you can click through to our platform to learn more about this and the 1 other warning sign we've identified .
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.
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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.
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