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Results: Black Hills Corporation Beat Earnings Expectations And Analysts Now Have New Forecasts
Investors in Black Hills Corporation (NYSE:BKH) had a good week, as its shares rose 2.9% to close at US$84.87 following the release of its quarterly results. Revenues of US$466m fell slightly short of expectations, but earnings were a definite bright spot, with statutory per-share profits of US$0.54 an impressive 25% ahead of estimates. The analysts typically update their forecasts at each earnings report, and we can judge from their estimates whether their view of the company has changed or if there are any new concerns to be aware of. With this in mind, we've gathered the latest statutory forecasts to see what the analysts are expecting for next year.
Following the latest results, Black Hills' five analysts are now forecasting revenues of US$4.33b in 2027. This would be a huge 85% improvement in revenue compared to the last 12 months. Statutory earnings per share are predicted to step up 11% to US$4.59. Yet prior to the latest earnings, the analysts had been anticipated revenues of US$4.33b and earnings per share (EPS) of US$4.61 in 2027. The consensus analysts don't seem to have seen anything in these results that would have changed their view on the business, given there's been no major change to their estimates.
See our latest analysis for Black Hills
The analysts reconfirmed their price target of US$87.07, showing that the business is executing well and in line with expectations. 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 Black Hills analyst has a price target of US$91.00 per share, while the most pessimistic values it at US$78.00. Even so, with a relatively close grouping of estimates, it looks like the analysts are quite confident in their valuations, suggesting Black Hills is an easy business to forecast or the the analysts are all using similar assumptions.
Another way we can view these estimates is in the context of the bigger picture, such as how the forecasts stack up against past performance, and whether forecasts are more or less bullish relative to other companies in the industry. The analysts are definitely expecting Black Hills' growth to accelerate, with the forecast 64% annualised growth to the end of 2027 ranking favourably alongside historical growth of 0.8% per annum over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to grow their revenue at 4.4% per year. Factoring in the forecast acceleration in revenue, it's pretty clear that Black Hills is expected to grow much faster than its industry.
The Bottom Line
The most obvious conclusion is that there's been no major change in the business' prospects in recent times, with the analysts holding their earnings forecasts steady, in line with previous estimates. Fortunately, they also reconfirmed their revenue numbers, suggesting that it's tracking in line with expectations. Additionally, our data suggests that revenue is expected to grow faster than the wider industry. There was no real change to the consensus price target, suggesting that the intrinsic value of the business has not undergone any major changes with the latest estimates.
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 Black Hills going out to 2028, and you can see them free on our platform here..
You should always think about risks though. Case in point, we've spotted 2 warning signs for Black Hills you should be aware of, and 1 of them shouldn't be ignored.
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