Results: CVR Energy, Inc. Exceeded Expectations And The Consensus Has Updated Its Estimates
CVR Energy, Inc. (NYSE:CVI) just released its third-quarter report and things are looking bullish. Statutory revenue of US$3.3b and earnings of US$5.67 both blasted past expectations, beating expectations by 40% and 91%, respectively, ahead of expectations. This is an important time for investors, as they can track a company's performance in its report, look at what experts are forecasting for next year, and see if there has been any change to expectations for the business. With this in mind, we've gathered the latest statutory forecasts to see what the analysts are expecting for next year.
Following the recent earnings report, the consensus from five analysts covering CVR Energy is for revenues of US$7.82b in 2027. This implies a disturbing 20% decline in revenue compared to the last 12 months. Statutory earnings per share are predicted to shoot up 53% to US$4.04. Before this earnings report, the analysts had been forecasting revenues of US$7.82b and earnings per share (EPS) of US$3.12 in 2027. Although the revenue estimates have not really changed, we can see there's been a considerable lift to earnings per share expectations, suggesting that the analysts have become more bullish after the latest result.
See our latest analysis for CVR Energy
The consensus price target rose 13% to US$47.50, suggesting that higher earnings estimates flow through to the stock's valuation as well. 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 CVR Energy at US$53.00 per share, while the most bearish prices it at US$38.00. This shows there is still a bit of diversity in estimates, but analysts don't appear to be totally split on the stock as though it might be a success or failure situation.
These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the CVR Energy's past performance and to peers in the same industry. Over the past five years, revenues have declined around 2.2% annually. Worse, forecasts are essentially predicting the decline to accelerate, with the estimate for an annualised 17% decline in revenue until the end of 2027. Compare this against analyst estimates for companies in the broader industry, which suggest that revenues (in aggregate) are expected to grow 0.7% annually. So it's pretty clear that, while it does have declining revenues, the analysts also expect CVR Energy to suffer worse 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 CVR Energy's earnings potential next year. On the plus side, there were no major changes to revenue estimates; although forecasts imply they will perform worse than the wider industry. We note an upgrade to the price target, suggesting that the analysts believes the intrinsic value of the business is likely to improve over time.
With that said, the long-term trajectory of the company's earnings is a lot more important than next year. We have estimates - from multiple CVR Energy analysts - going out to 2028, and you can see them free on our platform here.
You can also see whether CVR Energy is carrying too much debt, and whether its balance sheet is healthy, for free on our platform here.
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