These Analysts Think CSN Mineração S.A.'s (BVMF:CMIN3) Sales Are Under Threat

Today is shaping up negative for CSN Mineração S.A. (BVMF:CMIN3) shareholders, with the analysts delivering a substantial negative revision to this year's forecasts. 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 current consensus from CSN Mineração's ten analysts is for revenues of R$13b in 2022 which - if met - would reflect an okay 4.9% increase on its sales over the past 12 months. Prior to the latest estimates, the analysts were forecasting revenues of R$15b in 2022. It looks like forecasts have become a fair bit less optimistic on CSN Mineração, given the substantial drop in revenue estimates.

See our latest analysis for CSN Mineração

We'd point out that there was no major changes to their price target of R$5.68, suggesting the latest estimates were not enough to shift their view on the value of the business. There's another way to think about price targets though, and that's to look at the range of price targets put forward by analysts, because a wide range of estimates could suggest a diverse view on possible outcomes for the business. The most optimistic CSN Mineração analyst has a price target of R$9.00 per share, while the most pessimistic values it at R$3.50. This is a fairly broad spread of estimates, suggesting that the analysts are forecasting a wide range of possible outcomes for the business.

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the CSN Mineração's past performance and to peers in the same industry. For example, we noticed that CSN Mineração's rate of growth is expected to accelerate meaningfully, with revenues forecast to exhibit 10.0% growth to the end of 2022 on an annualised basis. That is well above its historical decline of 45% a year over the past year. Compare this against analyst estimates for the broader industry, which suggest that (in aggregate) industry revenues are expected to decline 3.1% per year. So although CSN Mineração is expected to return to growth, it's also expected to grow revenues during a time when the wider industry is estimated to see revenue decline.

The Bottom Line

The clear low-light was that analysts slashing their revenue forecasts for CSN Mineração this year. They're also forecasting for revenues to perform better than companies in the wider market. Overall, given the drastic downgrade to this year's forecasts, we'd be feeling a little more wary of CSN Mineração going forwards.

Hungry for more information? We have estimates for CSN Mineração from its ten analysts out until 2024, and you can see them 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.