Brigham Minerals, Inc. (NYSE:MNRL) defied analyst predictions to release its quarterly results, which were ahead of market expectations. Brigham Minerals delivered a significant beat to revenue and earnings per share (EPS) expectations, with sales hitting US$34m, some 12% above indicated. Statutory EPS were US$0.20, an impressive 27% ahead of forecasts. Earnings are an important time for investors, as they can track a company's performance, look at what the analysts are forecasting for next year, and see if there's been a change in sentiment towards the company. We've gathered the most recent statutory forecasts to see whether the analysts have changed their earnings models, following these results.
Following the latest results, Brigham Minerals' six analysts are now forecasting revenues of US$141.9m in 2021. This would be a major 52% improvement in sales compared to the last 12 months. Earnings are expected to improve, with Brigham Minerals forecast to report a statutory profit of US$0.89 per share. In the lead-up to this report, the analysts had been modelling revenues of US$135.0m and earnings per share (EPS) of US$0.78 in 2021. There's been a pretty noticeable increase in sentiment, with the analysts upgrading revenues and making a nice increase in earnings per share in particular.
Despite these upgrades,the analysts have not made any major changes to their price target of US$19.90, suggesting that the higher estimates are not likely to have a long term impact on what the stock is worth. 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 Brigham Minerals at US$23.00 per share, while the most bearish prices it at US$17.00. Analysts definitely have varying views on the business, but the spread of estimates is not wide enough in our view to suggest that extreme outcomes could await Brigham Minerals shareholders.
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. One thing stands out from these estimates, which is that Brigham Minerals is forecast to grow faster in the future than it has in the past, with revenues expected to display 75% annualised growth until the end of 2021. If achieved, this would be a much better result than the 19% annual decline over the past year. Compare this against analyst estimates for the broader industry, which suggest that (in aggregate) industry revenues are expected to grow 4.2% annually. So it looks like Brigham Minerals is expected to grow faster than its competitors, at least for a while.
The Bottom Line
The most important thing here is that the analysts upgraded their earnings per share estimates, suggesting that there has been a clear increase in optimism towards Brigham Minerals following these results. Pleasantly, they also upgraded their revenue estimates, and their forecasts suggest the business 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.
With that said, the long-term trajectory of the company's earnings is a lot more important than next year. At Simply Wall St, we have a full range of analyst estimates for Brigham Minerals going out to 2023, 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 Brigham Minerals you should be aware of, and 1 of them is concerning.
This article by Simply Wall St is general in nature. 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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