Yahoo Finance Need To Know: Analysts Are Much More Bullish On Range Resources Corporation (NYSE:RRC) Revenues
Range Resources Corporation (NYSE:RRC) shareholders will have a reason to smile today, with the analysts making substantial upgrades to this year's statutory forecasts. The consensus estimated revenue numbers rose, with their view now clearly much more bullish on the company's business prospects.
Following the latest upgrade, the current consensus, from the 19 analysts covering Range Resources, is for revenues of US$3.2b in 2023, which would reflect a substantial 50% reduction in Range Resources' sales over the past 12 months. Before the latest update, the analysts were foreseeing US$2.9b of revenue in 2023. It looks like there's been a clear increase in optimism around Range Resources, given the nice increase in revenue forecasts.
View our latest analysis for Range Resources
There was no particular change to the consensus price target of US$31.54, with Range Resources' latest outlook seemingly not enough to result in a change of valuation. 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 Range Resources analyst has a price target of US$50.00 per share, while the most pessimistic values it at US$20.00. This is a fairly broad spread of estimates, suggesting that the analysts are forecasting a wide range of possible outcomes for the business.
Looking at the bigger picture now, one of the ways we can make sense of these forecasts is to see how they measure up against both past performance and industry growth estimates. We would highlight that sales are expected to reverse, with a forecast 60% annualised revenue decline to the end of 2023. That is a notable change from historical growth of 10% over the last five years. By contrast, our data suggests that other companies (with analyst coverage) in the industry are forecast to see their revenue decline 4.4% annually for the foreseeable future. So it's pretty clear that Range Resources' revenues are expected to shrink faster than the wider industry.
The Bottom Line
The most important thing to take away from this upgrade is that analysts lifted their revenue estimates for this year. Analysts also expect revenues to shrink faster than the wider market. Given that analysts appear to be expecting substantial improvement in the sales pipeline, now could be the right time to take another look at Range Resources.
Analysts are definitely bullish on Range Resources, but no company is perfect. Indeed, you should know that there are several potential concerns to be aware of, including a weak balance sheet. You can learn more, and discover the 1 other flag we've identified, for free on our platform here.
We also provide an overview of the Range Resources Board and CEO remuneration and length of tenure at the company, and whether insiders have been buying the stock, here.
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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.
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