Newsflash: Balta Group NV (EBR:BALTA) Analysts Have Been Trimming Their Revenue Forecasts

One thing we could say about the analysts on Balta Group NV (EBR:BALTA) - they aren't optimistic, having just made a major negative revision to their near-term (statutory) forecasts for the organization. There was a fairly draconian cut to their revenue estimates, perhaps an implicit admission that previous forecasts were much too optimistic.

Following the downgrade, the most recent consensus for Balta Group from its dual analysts is for revenues of €525m in 2022 which, if met, would be a huge 90% increase on its sales over the past 12 months. Prior to the latest estimates, the analysts were forecasting revenues of €665m in 2022. The consensus view seems to have become more pessimistic on Balta Group, noting the pretty serious reduction to revenue estimates in this update.

Check out our latest analysis for Balta Group

Additionally, the consensus price target for Balta Group increased 8.7% to €4.35, showing a clear increase in optimism from the analysts involved. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. Currently, the most bullish analyst values Balta Group at €5.00 per share, while the most bearish prices it at €3.70. Even so, with a relatively close grouping of estimates, it looks like the analysts are quite confident in their valuations, suggesting Balta Group is an easy business to forecast or the underlying assumptions are obvious.

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. For example, we noticed that Balta Group's rate of growth is expected to accelerate meaningfully, with revenues forecast to exhibit 90% growth to the end of 2022 on an annualised basis. That is well above its historical decline of 3.8% a year over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in the industry are forecast to see their revenue grow 6.7% per year. So it looks like Balta Group is expected to grow faster than its competitors, at least for a while.

The Bottom Line

The clear low-light was that analysts slashing their revenue forecasts for Balta Group this year. The analysts also expect revenues to grow faster than the wider market. There was also an increase in the price target, suggesting that there is more optimism baked into the forecasts than there was previously. Given the stark change in sentiment, we'd understand if investors became more cautious on Balta Group after today.

Looking to learn more? At least one of Balta Group's dual analysts has provided estimates out to 2023, which can be seen 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 that insiders are buying.

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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.