Time To Worry? Analysts Just Downgraded Their Wilson Sons S.A. (BVMF:PORT3) Outlook

One thing we could say about the analysts on Wilson Sons S.A. (BVMF:PORT3) - they aren't optimistic, having just made a major negative revision to their near-term (statutory) forecasts for the organization. This report focused on revenue estimates, and it looks as though the consensus view of the business has become substantially more conservative.

Following the latest downgrade, the three analysts covering Wilson Sons provided consensus estimates of R$2.4b revenue in 2024, which would reflect a perceptible 4.6% decline on its sales over the past 12 months. Statutory earnings per share are anticipated to sink 17% to R$0.80 in the same period. Prior to this update, the analysts had been forecasting revenues of R$2.7b and earnings per share (EPS) of R$0.82 in 2024. Indeed, we can see that analyst sentiment has declined measurably after the new consensus came out, with a measurable cut to revenue estimates and a minor downgrade to EPS estimates to boot.

Check out our latest analysis for Wilson Sons

Despite the cuts to forecast earnings, there was no real change to the US$3.47 price target, showing that the analysts don't think the changes have a meaningful impact on its intrinsic value. That's not the only conclusion we can draw from this data however, as some investors also like to consider the spread in estimates when evaluating analyst price targets. There are some variant perceptions on Wilson Sons, with the most bullish analyst valuing it at US$4.10 and the most bearish at US$2.56 per share. Analysts definitely have varying views on the business, but the spread of estimates is not wide enough in our view to suggest that extreme outcomes could await Wilson Sons shareholders.

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Wilson Sons' past performance and to peers in the same industry. We would highlight that sales are expected to reverse, with a forecast 6.1% annualised revenue decline to the end of 2024. That is a notable change from historical growth of 7.9% over the last five years. By contrast, our data suggests that other companies (with analyst coverage) in the same industry are forecast to see their revenue grow 7.0% annually for the foreseeable future. It's pretty clear that Wilson Sons' revenues are expected to perform substantially worse than the wider industry.

The Bottom Line

The most important thing to take away is that analysts cut their earnings per share estimates, expecting a clear decline in business conditions. Regrettably, they also downgraded their revenue estimates, and the latest forecasts imply the business will grow sales slower than the wider market. Given the stark change in sentiment, we'd understand if investors became more cautious on Wilson Sons after today.

There might be good reason for analyst bearishness towards Wilson Sons, like a weak balance sheet. For more information, you can click here to discover this and the 2 other concerns we've identified.

We also provide an overview of the Wilson Sons Board and CEO remuneration and length of tenure at the company, and whether insiders have been buying the stock, here.

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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.