Meridian Energy Limited's Earnings Fall Short of Analyst Expectations: Current Analyst Forecasts Revealed

Meridian Energy Limited Annual Results

• Revenue Performance: Meridian Energy reported revenues of NZ$4.8 billion, surpassing expectations by 2.8%.
• Earnings Per Share (EPS): The company faced a significant setback with a statutory EPS loss of NZ$0.17, contrary to analyst expectations of a profit.

Analyst Forecasts and Sentiment

• Future Revenue Expectations: Analysts predict revenues for 2026 to be NZ$4.90 billion, aligning closely with the previous year's performance.
• Earnings Recovery: Statutory earnings are expected to improve to NZ$0.14 per share in 2026, although this is a downgrade from earlier forecasts of NZ$0.16.

Price Target and Valuation

• Consensus Price Target: The consensus price target remains stable at NZ$6.35, indicating that analysts do not foresee a significant drop in stock price despite lowered earnings forecasts.
• Analyst Valuation Range: The most optimistic analyst values the stock at NZ$6.72, while the most pessimistic sets it at NZ$5.50, reflecting a narrow range of valuations among analysts.

Industry Context and Growth Outlook

• Growth Rate Comparison: Meridian Energy's projected annualized revenue growth rate of 1.3% until 2026 is significantly lower than its historical growth rate of 7.2% and the industry average of 7.4%.
• Analyst Sentiment Decline: The downgrade in EPS estimates indicates a decline in analyst sentiment, although revenue estimates remain consistent with expectations.

Long-term Considerations

• Earnings Power vs. Short-term Profits: Analysts emphasize the importance of long-term earnings potential over immediate profits, suggesting a cautious approach to conclusions about Meridian Energy's future.
• Risk Awareness: Investors are advised to consider potential risks, with one warning sign identified for Meridian Energy that warrants attention.