Analysts Just Made A Major Revision To Their Intelbras S.A. - Indústria de Telecomunicação Eletrônica Brasileira (BVMF:INTB3) Revenue Forecasts

The latest analyst coverage could presage a bad day for Intelbras S.A. - Indústria de Telecomunicação Eletrônica Brasileira (BVMF:INTB3), with the analysts making across-the-board cuts to their statutory estimates that might leave shareholders a little shell-shocked. There was a fairly draconian cut to their revenue estimates, perhaps an implicit admission that previous forecasts were much too optimistic.

After this downgrade, Intelbras - Indústria de Telecomunicação Eletrônica Brasileira's seven analysts are now forecasting revenues of R$4.7b in 2023. This would be a credible 7.0% improvement in sales compared to the last 12 months. Per-share earnings are expected to expand 13% to R$1.77. Before this latest update, the analysts had been forecasting revenues of R$5.1b and earnings per share (EPS) of R$1.83 in 2023. It's pretty clear that analyst sentiment has fallen after the recent consensus updates, leading to lower revenue forecasts and a minor downgrade to earnings per share estimates.

Check out our latest analysis for Intelbras - Indústria de Telecomunicação Eletrônica Brasileira

It'll come as no surprise then, to learn that the analysts have cut their price target 6.8% to R$34.07. The consensus price target is just an average of individual analyst targets, so - it could be handy to see how wide the range of underlying estimates is. Currently, the most bullish analyst values Intelbras - Indústria de Telecomunicação Eletrônica Brasileira at R$38.00 per share, while the most bearish prices it at R$29.00. The narrow spread of estimates could suggest that the business' future is relatively easy to value, or that the analysts have a clear view on its prospects.

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 Intelbras - Indústria de Telecomunicação Eletrônica Brasileira's revenue growth will slow down substantially, with revenues to the end of 2023 expected to display 9.4% growth on an annualised basis. This is compared to a historical growth rate of 32% over the past three years. Compare this to the 479 other companies in this industry with analyst coverage, which are forecast to grow their revenue at 8.7% per year. So it's pretty clear that, while Intelbras - Indústria de Telecomunicação Eletrônica Brasileira's revenue growth is expected to slow, it's expected to grow roughly in line with the industry.

The Bottom Line

The biggest issue in the new estimates is that analysts have reduced their earnings per share estimates, suggesting business headwinds lay ahead for Intelbras - Indústria de Telecomunicação Eletrônica Brasileira. Lamentably, they also downgraded their sales forecasts, but the business is still expected to grow at roughly the same rate as the market itself. The consensus price target fell measurably, with analysts seemingly not reassured by recent business developments, leading to a lower estimate of Intelbras - Indústria de Telecomunicação Eletrônica Brasileira's future valuation. Given the stark change in sentiment, we'd understand if investors became more cautious on Intelbras - Indústria de Telecomunicação Eletrônica Brasileira after today.

With that said, the long-term trajectory of the company's earnings is a lot more important than next year. We have estimates - from multiple Intelbras - Indústria de Telecomunicação Eletrônica Brasileira analysts - going out to 2025, 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.