Civeo Corporation (NYSE:CVEO) investors will be delighted, with the company turning in some strong numbers with its latest results. It was overall a positive result, with revenues beating expectations by 9.4% to hit US$189m. Civeo also reported a statutory profit of US$0.56, which was an impressive 140% above what the analysts had forecast. 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. So we gathered the latest post-earnings forecasts to see what estimates suggest is in store for next year.

Following the recent earnings report, the consensus from three analysts covering Civeo is for revenues of US$678.9m in 2024. This implies a perceptible 4.3% decline in revenue compared to the last 12 months. Statutory earnings per share are forecast to tumble 76% to US$0.58 in the same period. Yet prior to the latest earnings, the analysts had been anticipated revenues of US$666.0m and earnings per share (EPS) of US$0.42 in 2024. There was no real change to the revenue estimates, but the analysts do seem more bullish on earnings, given the sizeable expansion in earnings per share expectations following these results.

There's been no major changes to the consensus price target of US$32.50, suggesting that the improved earnings per share outlook is not enough to have a long-term positive impact on the stock'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 Civeo at US$33.00 per share, while the most bearish prices it at US$32.00. With such a narrow range of valuations, the analysts apparently share similar views on what they think the business is worth.

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Civeo's past performance and to peers in the same industry. We would highlight that revenue is expected to reverse, with a forecast 8.4% annualised decline to the end of 2024. That is a notable change from historical growth of 8.3% 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 6.5% annually for the foreseeable future. So although its revenues are forecast to shrink, this cloud does not come with a silver lining - Civeo is expected to lag 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 Civeo's earnings potential next year. Fortunately, the analysts also reconfirmed their revenue estimates, suggesting that it's tracking in line with expectations. Although our data does suggest that Civeo's revenue is expected to perform worse 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.

Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. At Simply Wall St, we have a full range of analyst estimates for Civeo going out to 2026, and you can see them free on our platform here..

You still need to take note of risks, for example - Civeo has 3 warning signs (and 1 which makes us a bit uncomfortable) we think 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.

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