Liberty Energy Inc. (NYSE:LBRT) came out with its second-quarter results last week, and we wanted to see how the business is performing and what industry forecasters think of the company following this report. Liberty Energy reported US$1.2b in revenue, roughly in line with analyst forecasts, although statutory earnings per share (EPS) of US$0.64 beat expectations, being 6.5% higher than what the analysts expected. 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. We thought readers would find it interesting to see the analysts latest (statutory) post-earnings forecasts for next year.

Taking into account the latest results, Liberty Energy's 14 analysts currently expect revenues in 2024 to be US$4.46b, approximately in line with the last 12 months. Statutory earnings per share are forecast to decline 15% to US$2.21 in the same period. In the lead-up to this report, the analysts had been modelling revenues of US$4.61b and earnings per share (EPS) of US$2.43 in 2024. The analysts are less bullish than they were before these results, given the reduced revenue forecasts and the small dip in earnings per share expectations.

The analysts made no major changes to their price target of US$24.90, suggesting the downgrades are not expected to have a long-term impact on Liberty Energy's 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. Currently, the most bullish analyst values Liberty Energy at US$28.00 per share, while the most bearish prices it at US$18.00. 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.

One way to get more context on these forecasts is to look at how they compare to both past performance, and how other companies in the same industry are performing. We would highlight that revenue is expected to reverse, with a forecast 2.9% annualised decline to the end of 2024. That is a notable change from historical growth of 27% over the last five years. By contrast, our data suggests that other companies (with analyst coverage) in the same industry are forecast to see their revenue grow 7.5% annually for the foreseeable future. So although its revenues are forecast to shrink, this cloud does not come with a silver lining - Liberty Energy is expected to lag the wider industry.

The Bottom Line

The most important thing to take away is that the analysts downgraded their earnings per share estimates, showing that there has been a clear decline in sentiment following these results. Unfortunately, they also downgraded their revenue estimates, and our data indicates underperformance compared to the wider industry. Even so, earnings per share are more important to the intrinsic value of the business. The consensus price target held steady at US$24.90, with the latest estimates not enough to have an impact on their price targets.

With that in mind, we wouldn't be too quick to come to a conclusion on Liberty Energy. Long-term earnings power is much more important than next year's profits. We have estimates - from multiple Liberty Energy analysts - going out to 2026, and you can see them free on our platform here.

Don't forget that there may still be risks. For instance, we've identified 2 warning signs for Liberty Energy (1 doesn't sit too well with us) you should be aware of.

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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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com