Viper Energy, Inc. (NASDAQ:VNOM) Just Released Its Annual Results And Analysts Are Updating Their Estimates
The yearly results for Viper Energy, Inc. (NASDAQ:VNOM) were released last week, making it a good time to revisit its performance. Revenues were US$791m, with Viper Energy reporting some 4.6% below analyst expectations. This is an important time for investors, as they can track a company's performance in its report, look at what experts are forecasting for next year, and see if there has been any change to expectations for the business. So we gathered the latest post-earnings forecasts to see what estimates suggest is in store for next year.
See our latest analysis for Viper Energy
Following last week's earnings report, Viper Energy's six analysts are forecasting 2024 revenues to be US$803.2m, approximately in line with the last 12 months. Statutory earnings per share are forecast to dive 33% to US$1.55 in the same period. Yet prior to the latest earnings, the analysts had been anticipated revenues of US$831.0m and earnings per share (EPS) of US$1.68 in 2024. The analysts are less bullish than they were before these results, given the reduced revenue forecasts and the minor downgrade to earnings per share expectations.
Despite the cuts to forecast earnings, there was no real change to the US$37.00 price target, showing that the analysts don't think the changes have a meaningful impact on its intrinsic value. That's not the only conclusion we can draw from this data however, as some investors also like to consider the spread in estimates when evaluating analyst price targets. The most optimistic Viper Energy analyst has a price target of US$40.00 per share, while the most pessimistic values it at US$33.00. Even so, with a relatively close grouping of estimates, it looks like the analysts are quite confident in their valuations, suggesting Viper Energy is an easy business to forecast or the the analysts are all using similar assumptions.
One way to get more context on these forecasts is to look at how they compare to both past performance, and how other companies in the same industry are performing. It's pretty clear that there is an expectation that Viper Energy's revenue growth will slow down substantially, with revenues to the end of 2024 expected to display 1.6% growth on an annualised basis. This is compared to a historical growth rate of 28% over the past five years. Juxtapose this against the other companies in the industry with analyst coverage, which are forecast to grow their revenues (in aggregate) 1.7% annually. So it's pretty clear that, while Viper Energy's revenue growth is expected to slow, it's expected to grow roughly in line with the industry.
The Bottom Line
The biggest concern is that the analysts reduced their earnings per share estimates, suggesting business headwinds could lay ahead for Viper Energy. Sadly, they also downgraded their revenue forecasts, but the business is still expected to grow at roughly the same rate as the industry itself. The consensus price target held steady at US$37.00, with the latest estimates not enough to have an impact on their price targets.
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. At Simply Wall St, we have a full range of analyst estimates for Viper Energy going out to 2026, and you can see them free on our platform here..
Even so, be aware that Viper Energy is showing 2 warning signs in our investment analysis , and 1 of those can't be ignored...
Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.
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.
