Capital Power Corporation (TSE:CPX) just released its quarterly report and things are looking bullish. Statutory revenue of CA$988m and earnings of CA$1.03 both blasted past expectations, beating expectations by 29% and 78%, respectively, 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. So we collected the latest post-earnings statutory consensus estimates to see what could be in store for next year.

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After the latest results, the consensus from Capital Power's six analysts is for revenues of CA$2.96b in 2025, which would reflect a chunky 16% decline in revenue compared to the last year of performance. Statutory earnings per share are expected to crater 24% to CA$3.04 in the same period. Yet prior to the latest earnings, the analysts had been anticipated revenues of CA$3.38b and earnings per share (EPS) of CA$2.58 in 2025. So there's been quite a change-up of views after the latest results, with the analysts making a serious cut to their revenue forecasts while also granting a substantial gain in to the earnings per share numbers.

Check out our latest analysis for Capital Power

There's been no real change to the average price target of CA$64.55, with the lower revenue and higher earnings forecasts not expected to meaningfully impact the company's valuation over a longer timeframe. The consensus price target is just an average of individual analyst targets, so - it could be handy to see how wide the range of underlying estimates is. The most optimistic Capital Power analyst has a price target of CA$76.00 per share, while the most pessimistic values it at CA$58.00. The narrow spread of estimates could suggest that the business' future is relatively easy to value, or thatthe analysts have a strong view on its prospects.

Another way we can view these estimates is in the context of the bigger picture, such as how the forecasts stack up against past performance, and whether forecasts are more or less bullish relative to other companies in the industry. We would highlight that revenue is expected to reverse, with a forecast 21% annualised decline to the end of 2025. That is a notable change from historical growth of 20% 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 3.2% per year. So although its revenues are forecast to shrink, this cloud does not come with a silver lining - Capital Power is expected to lag the wider industry.

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The Bottom Line

The most important thing here is that the analysts upgraded their earnings per share estimates, suggesting that there has been a clear increase in optimism towards Capital Power following these results. On the negative side, they also downgraded their revenue estimates, and forecasts imply they will perform worse than the wider industry. Even so, earnings per share are more important to the intrinsic value of the business. 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. We have forecasts for Capital Power going out to 2027, and you can see them free on our platform here.

It is also worth noting that we have found 5 warning signs for Capital Power (1 can't be ignored!) that you need to take into consideration.

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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.