Yahoo Finance EnLink Midstream, LLC Earnings Missed Analyst Estimates: Here's What Analysts Are Forecasting Now
As you might know, EnLink Midstream, LLC (NYSE:ENLC) last week released its latest first-quarter, and things did not turn out so great for shareholders. EnLink Midstream delivered a grave earnings miss, with both revenues (US$1.6b) and statutory earnings per share (US$0.03) falling badly short of analyst expectations. Following the result, the analysts have updated their earnings model, and it would be good to know whether they think there's been a strong change in the company's prospects, or if it's business as usual. We thought readers would find it interesting to see the analysts latest (statutory) post-earnings forecasts for next year.
View our latest analysis for EnLink Midstream
Following the latest results, EnLink Midstream's five analysts are now forecasting revenues of US$7.31b in 2024. This would be a decent 8.1% improvement in revenue compared to the last 12 months. Per-share earnings are expected to shoot up 62% to US$0.58. Before this earnings report, the analysts had been forecasting revenues of US$8.38b and earnings per share (EPS) of US$0.59 in 2024. Indeed we can see that the consensus opinion has undergone some fundamental changes following the latest results, with a real cut to revenues and some minor tweaks to earnings numbers.
The consensus has reconfirmed its price target of US$14.83, showing that the analysts don't expect weaker revenue expectations next year to have a material impact on EnLink Midstream's market value. 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 EnLink Midstream at US$17.00 per share, while the most bearish prices it at US$13.00. This is a very narrow spread of estimates, implying either that EnLink Midstream is an easy company to value, or - more likely - the analysts are relying heavily on some key assumptions.
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. It's clear from the latest estimates that EnLink Midstream's rate of growth is expected to accelerate meaningfully, with the forecast 11% annualised revenue growth to the end of 2024 noticeably faster than its historical growth of 7.2% p.a. over the past five years. Compare this with other companies in the same industry, which are forecast to grow their revenue 2.0% annually. It seems obvious that, while the growth outlook is brighter than the recent past, the analysts also expect EnLink Midstream to grow faster than the wider industry.
The Bottom Line
The most important thing to take away is that there's been no major change in sentiment, with the analysts reconfirming that the business is performing in line with their previous earnings per share estimates. Regrettably, they also downgraded their revenue estimates, but the latest forecasts still imply the business will grow faster than the wider industry. Even so, earnings per share are more important to the intrinsic value of the business. The consensus price target held steady at US$14.83, with the latest estimates not enough to have an impact on their price targets.
With that in mind, we wouldn't be too quick to come to a conclusion on EnLink Midstream. Long-term earnings power is much more important than next year's profits. We have forecasts for EnLink Midstream going out to 2026, and you can see them free on our platform here.
However, before you get too enthused, we've discovered 4 warning signs for EnLink Midstream (1 is concerning!) that you should be aware of.
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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.
