Some Analysts Just Cut Their OceanPact Serviços Marítimos S.A. (BVMF:OPCT3) Estimates

The analysts covering OceanPact Serviços Marítimos S.A. (BVMF:OPCT3) delivered a dose of negativity to shareholders today, by making a substantial revision to their statutory forecasts for this year. There was a fairly draconian cut to their revenue estimates, perhaps an implicit admission that previous forecasts were much too optimistic. Surprisingly the share price has been buoyant, rising 15% to R$4.00 in the past 7 days. It will be interesting to see if the downgrade has an impact on buying demand for the company's shares.

After this downgrade, OceanPact Serviços Marítimos' dual analysts are now forecasting revenues of R$1.4b in 2023. This would be a notable 17% improvement in sales compared to the last 12 months. Losses are predicted to fall substantially, shrinking 81% to R$0.089. However, before this estimates update, the consensus had been expecting revenues of R$1.6b and R$0.089 per share in losses. So there's been quite a change-up of views after the recent consensus updates, with the analysts making a serious cut to their revenue forecasts while also making no real change to the loss per share numbers.

See our latest analysis for OceanPact Serviços Marítimos

The consensus price target rose 12% to R$5.95, seeming to imply that weaker revenue sentiment is not expected to have a major impact on the company's valuation. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. There are some variant perceptions on OceanPact Serviços Marítimos, with the most bullish analyst valuing it at R$9.00 and the most bearish at R$3.00 per share. As you can see the range of estimates is wide, with the lowest valuation coming in at less than half the most bullish estimate, suggesting there are some strongly diverging views on how think this business will perform. With this in mind, we wouldn't rely too heavily on the consensus price target, as it is just an average and analysts clearly have some deeply divergent views on the business.

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. It's pretty clear that there is an expectation that OceanPact Serviços Marítimos' revenue growth will slow down substantially, with revenues to the end of 2023 expected to display 23% growth on an annualised basis. This is compared to a historical growth rate of 29% over the past five years. Compare this to the 7 other companies in this industry with analyst coverage, which are forecast to grow their revenue at 21% per year. Factoring in the forecast slowdown in growth, it looks like OceanPact Serviços Marítimos is forecast to grow at about the same rate as the wider industry.

The Bottom Line

Lamentably, they also downgraded their sales forecasts, but the business is still expected to grow at roughly the same rate as the market itself. There was also an increase in the price target, suggesting that there is more optimism baked into the forecasts than there was previously. Often, one downgrade can set off a daisy-chain of cuts, especially if an industry is in decline. So we wouldn't be surprised if the market became a lot more cautious on OceanPact Serviços Marítimos after today.

Even so, the longer term trajectory of the business is much more important for the value creation of shareholders. At least one analyst has provided forecasts out to 2025, 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.