Sable Offshore Corp. (NYSE:SOC) shareholders are probably feeling a little disappointed, since its shares fell 5.4% to US$4.38 in the week after its latest quarterly results. It was a pretty bad result overall, with revenues coming in 43% lower than the analysts predicted. Unsurprisingly, the statutory profit the analysts had been forecasting evaporated, turning into a loss of US$0.42 per share. 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. So we gathered the latest post-earnings forecasts to see what estimates suggest is in store for next year.

Following the latest results, Sable Offshore's three analysts are now forecasting revenues of US$539.4m in 2026. This would be a huge 290% improvement in revenue compared to the last 12 months. Statutory losses are forecast to balloon 32% to US$1.54 per share. Before this earnings report, the analysts had been forecasting revenues of US$723.9m and earnings per share (EPS) of US$0.083 in 2026. So we can see that the consensus has become notably more bearish on Sable Offshore's outlook following these results, with a large cut to next year's revenue estimates. Furthermore, they expect the business to be loss-making next year, compared to their previous calls for a profit.

The average price target fell 12% to US$11.67, implicitly signalling that lower earnings per share are a leading indicator for Sable Offshore's valuation. Fixating on a single price target can be unwise though, since the consensus target is effectively the average of analyst price targets. As a result, some investors like to look at the range of estimates to see if there are any diverging opinions on the company's valuation. The most optimistic Sable Offshore analyst has a price target of US$15.00 per share, while the most pessimistic values it at US$9.00. As you can see, analysts are not all in agreement on the stock's future, but the range of estimates is still reasonably narrow, which could suggest that the outcome is not totally unpredictable.

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. The analysts are definitely expecting Sable Offshore's growth to accelerate, with the forecast 14x annualised growth to the end of 2026 ranking favourably alongside historical growth of 171% per annum over the past three years. Compare this with other companies in the same industry, which are forecast to grow their revenue 1.5% annually. It seems obvious that, while the growth outlook is brighter than the recent past, the analysts also expect Sable Offshore to grow faster than the wider industry.

The Bottom Line

The biggest low-light for us was that the forecasts for Sable Offshore dropped from profits to a loss next year. They also downgraded Sable Offshore's revenue estimates, but industry data suggests that it is 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 Sable Offshore's future valuation.

Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. At Simply Wall St, we have a full range of analyst estimates for Sable Offshore going out to 2028, and you can see them free on our platform here..

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.