A week ago, Odfjell Drilling Ltd. (OB:ODL) came out with a strong set of quarterly numbers that could potentially lead to a re-rate of the stock. The company beat forecasts, with revenue of US$251m, some 7.7% above estimates, and statutory earnings per share (EPS) coming in at US$0.23, 59% 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.
Taking into account the latest results, Odfjell Drilling's four analysts currently expect revenues in 2026 to be US$1.08b, approximately in line with the last 12 months. Statutory earnings per share are predicted to ascend 14% to US$1.06. Before this earnings report, the analysts had been forecasting revenues of US$1.03b and earnings per share (EPS) of US$0.95 in 2026. There's been a pretty noticeable increase in sentiment, with the analysts upgrading revenues and making a substantial gain in earnings per share in particular.
See our latest analysis for Odfjell Drilling
Althoughthe analysts have upgraded their earnings estimates, there was no change to the consensus price target of kr111, suggesting that the forecast performance does not have a long term impact on the company'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. There are some variant perceptions on Odfjell Drilling, with the most bullish analyst valuing it at kr116 and the most bearish at kr105 per share. Note the wide gap in analyst price targets? This implies to us that there is a fairly broad range of possible scenarios for the underlying business.
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. We would highlight that revenue is expected to reverse, with a forecast 3.1% annualised decline to the end of 2026. That is a notable change from historical growth of 8.0% over the last five years. Compare this with our data, which suggests that other companies in the same industry are, in aggregate, expected to see their revenue grow 0.5% per year. So although its revenues are forecast to shrink, this cloud does not come with a silver lining - Odfjell Drilling 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 Odfjell Drilling's earnings potential next year. They also upgraded their revenue estimates for next year, even though it is expected to grow slower than the wider industry. The consensus price target held steady at kr111, with the latest estimates not enough to have an impact on their price targets.
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 Odfjell Drilling going out to 2028, and you can see them free on our platform here..
You still need to take note of risks, for example - Odfjell Drilling has 2 warning signs (and 1 which is potentially serious) 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.