Brokers

PNW) After Its Yearly Report

Pinnacle West Capital Corporation (NYSE:PNW) just released its latest annual results and things are looking bullish. The company beat expectations with revenues of US$4.7b arriving 3.5% ahead of forecasts. Statutory earnings per share (EPS) were US$4.41, 3.0% ahead of estimates. Earnings are an important time for investors, as they can track a company’s performance, look at what the analysts are forecasting for next year, and see if there’s been a change in sentiment towards the company. So we gathered the latest post-earnings forecasts to see what estimates suggest is in store for next year.

Check out our latest analysis for Pinnacle West Capital

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After the latest results, the seven analysts covering Pinnacle West Capital are now predicting revenues of US$4.90b in 2024. If met, this would reflect a satisfactory 4.4% improvement in revenue compared to the last 12 months. Statutory earnings per share are predicted to accumulate 8.1% to US$4.78. Yet prior to the latest earnings, the analysts had been anticipated revenues of US$4.79b and earnings per share (EPS) of US$4.77 in 2024. So it looks like there’s been no major change in sentiment following the latest results, although the analysts have made a small increase to to revenue forecasts.

It may not be a surprise to see thatthe analysts have reconfirmed their price target of US$76.10, implying that the uplift in revenue is not expected to greatly contribute to Pinnacle West Capital’s valuation in the near term. 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. The most optimistic Pinnacle West Capital analyst has a price target of US$95.00 per share, while the most pessimistic values it at US$68.00. These price targets show that analysts do have some differing views on the business, but the estimates do not vary enough to suggest to us that some are betting on wild success or utter failure.

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Pinnacle West Capital’s past performance and to peers in the same industry. We would highlight that Pinnacle West Capital’s revenue growth is expected to slow, with the forecast 4.4% annualised growth rate until the end of 2024 being well below the historical 6.0% p.a. growth over the last five years. By way of comparison, the other companies in this industry with analyst coverage are forecast to grow their revenue at 3.4% annually. Even after the forecast slowdown in growth, it seems obvious that Pinnacle West Capital is also expected to grow faster than the wider industry.

The Bottom Line

The most obvious conclusion is that there’s been no major change in the business’ prospects in recent times, with the analysts holding their earnings forecasts steady, in line with previous estimates. Pleasantly, they also upgraded their revenue estimates, and their forecasts suggest the business is expected to grow faster than the wider industry. The consensus price target held steady at US$76.10, with the latest estimates not enough to have an impact on their price targets.

With that said, the long-term trajectory of the company’s earnings is a lot more important than next year. At Simply Wall St, we have a full range of analyst estimates for Pinnacle West Capital going out to 2026, and you can see them free on our platform here..

Plus, you should also learn about the 2 warning signs we’ve spotted with Pinnacle West Capital (including 1 which makes us a bit uncomfortable) .

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

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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