Last week saw the newest quarterly earnings release from National Fuel Gas Company (NYSE:NFG), an important milestone in the company's journey to build a stronger business. Revenues missed the mark, coming in 18% below forecasts, at US$630m. Statutory profits were a real bright spot in contrast, with per-share profits of US$1.80 being a notable 28% above what the analysts were modelling. 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.

See our latest analysis for National Fuel Gas

Taking into account the latest results, the current consensus from National Fuel Gas' three analysts is for revenues of US$2.24b in 2024. This would reflect a decent 15% increase on its revenue over the past 12 months. Statutory earnings per share are forecast to dip 8.3% to US$4.63 in the same period. Before this earnings report, the analysts had been forecasting revenues of US$2.38b and earnings per share (EPS) of US$4.53 in 2024. If anything, the analysts look to have become slightly more optimistic overall; while they decreased their revenue forecasts, EPS predictions increased and ultimately earnings are more important.

There's been no real change to the average price target of US$63.67, with the lower revenue and higher earnings forecasts not expected to meaningfully impact the company's valuation over a longer timeframe. 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. Currently, the most bullish analyst values National Fuel Gas at US$72.00 per share, while the most bearish prices it at US$56.00. Even so, with a relatively close grouping of estimates, it looks like the analysts are quite confident in their valuations, suggesting National Fuel Gas is an easy business to forecast or the the analysts are all using similar 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. The analysts are definitely expecting National Fuel Gas' growth to accelerate, with the forecast 32% annualised growth to the end of 2024 ranking favourably alongside historical growth of 7.6% per annum over the past five years. Compare this with other companies in the same industry, which are forecast to grow their revenue 7.9% annually. It seems obvious that, while the growth outlook is brighter than the recent past, the analysts also expect National Fuel Gas to grow faster than the wider industry.

The Bottom Line

The biggest takeaway for us is the consensus earnings per share upgrade, which suggests a clear improvement in sentiment around National Fuel Gas' earnings potential next year. They also downgraded National Fuel Gas' revenue estimates, but industry data suggests that it is expected to grow faster than the wider industry. Even so, long term profitability is more important for the value creation process. The consensus price target held steady at US$63.67, with the latest estimates not enough to have an impact on their price targets.

Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. We have estimates - from multiple National Fuel Gas analysts - going out to 2026, and you can see them free on our platform here.

Even so, be aware that National Fuel Gas is showing 2 warning signs in our investment analysis , you should know about...

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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.