Market forces rained on the parade of HighPeak Energy, Inc. (NASDAQ:HPK) shareholders today, when the analysts downgraded their forecasts for this year. Both revenue and earnings per share (EPS) estimates were cut sharply as the analysts factored in the latest outlook for the business, concluding that they were too optimistic previously.

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After the downgrade, the consensus from HighPeak Energy's twin analysts is for revenues of US$877m in 2025, which would reflect an uneasy 18% decline in sales compared to the last year of performance. Statutory earnings per share are presumed to climb 17% to US$0.80. Prior to this update, the analysts had been forecasting revenues of US$993m and earnings per share (EPS) of US$1.23 in 2025. It looks like analyst sentiment has declined substantially, with a measurable cut to revenue estimates and a large cut to earnings per share numbers as well.

View our latest analysis for HighPeak Energy

The consensus price target fell 5.5% to US$17.17, with the weaker earnings outlook clearly leading analyst valuation estimates.

Of course, another way to look at these forecasts is to place them into context against the industry itself. These estimates imply that sales are expected to slow, with a forecast annualised revenue decline of 18% by the end of 2025. This indicates a significant reduction from annual growth of 55% 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 3.5% per year. So although its revenues are forecast to shrink, this cloud does not come with a silver lining - HighPeak Energy is expected to lag the wider industry.

The Bottom Line

The most important thing to take away is that analysts cut their earnings per share estimates, expecting a clear decline in business conditions. Unfortunately analysts also downgraded their revenue estimates, and industry data suggests that HighPeak Energy's revenues are expected to grow slower than the wider market. With a serious cut to this year's expectations and a falling price target, we wouldn't be surprised if investors were becoming wary of HighPeak Energy.

That said, the analysts might have good reason to be negative on HighPeak Energy, given its declining profit margins. Learn more, and discover the 1 other warning sign we've identified, for free on our platform here.

Of course, seeing company management invest large sums of money in a stock can be just as useful as knowing whether analysts are downgrading their estimates. So you may also wish to search this free list of stocks with high insider ownership.

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