FirstEnergy Corp. (NYSE:FE) just released its latest full-year report and things are not looking great. Results showed a clear earnings miss, with US$13b revenue coming in 2.4% lower than what the analystsexpected. Statutory earnings per share (EPS) of US$1.70 missed the mark badly, arriving some 27% below what was expected. The analysts typically update their forecasts at each earnings report, and we can judge from their estimates whether their view of the company has changed or if there are any new concerns to be aware of. We thought readers would find it interesting to see the analysts latest (statutory) post-earnings forecasts for next year.

View our latest analysis for FirstEnergy

After the latest results, the ten analysts covering FirstEnergy are now predicting revenues of US$14.4b in 2025. If met, this would reflect a satisfactory 7.1% improvement in revenue compared to the last 12 months. Per-share earnings are expected to surge 59% to US$2.69. Before this earnings report, the analysts had been forecasting revenues of US$14.3b and earnings per share (EPS) of US$2.87 in 2025. So it looks like there's been a small decline in overall sentiment after the recent results - there's been no major change to revenue estimates, but the analysts did make a small dip in their earnings per share forecasts.

It might be a surprise to learn that the consensus price target fell 5.3% to US$43.81, with the analysts clearly linking lower forecast earnings to the performance of the stock price. 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 FirstEnergy, with the most bullish analyst valuing it at US$52.00 and the most bearish at US$41.00 per share. With such a narrow range of valuations, the analysts apparently share similar views on what they think the business is worth.

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. It's clear from the latest estimates that FirstEnergy's rate of growth is expected to accelerate meaningfully, with the forecast 7.1% annualised revenue growth to the end of 2025 noticeably faster than its historical growth of 5.4% p.a. over the past five years. Compare this with other companies in the same industry, which are forecast to grow their revenue 5.3% annually. It seems obvious that, while the growth outlook is brighter than the recent past, the analysts also expect FirstEnergy to grow faster than 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. Happily, there were no major changes to revenue forecasts, with the business still expected to grow faster than the wider industry. The consensus price target fell measurably, with the analysts seemingly not reassured by the latest results, leading to a lower estimate of FirstEnergy's future valuation.

With that in mind, we wouldn't be too quick to come to a conclusion on FirstEnergy. Long-term earnings power is much more important than next year's profits. We have forecasts for FirstEnergy going out to 2027, and you can see them free on our platform here.

That said, it's still necessary to consider the ever-present spectre of investment risk. We've identified 2 warning signs with FirstEnergy , and understanding them should be part of your investment process.

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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.