What Does The Future Hold For Exro Technologies Inc. (TSE:EXRO)? These Analysts Have Been Cutting Their Estimates

The analysts covering Exro Technologies Inc. (TSE:EXRO) delivered a dose of negativity to shareholders today, by making a substantial revision to their statutory forecasts for next year. There was a fairly draconian cut to their revenue estimates, perhaps an implicit admission that previous forecasts were much too optimistic. The stock price has risen 6.1% to CA$0.17 over the past week. Investors could be forgiven for changing their mind on the business following the downgrade; but it's not clear if the revised forecasts will lead to selling activity.

Following the downgrade, the most recent consensus for Exro Technologies from its five analysts is for revenues of CA$97m in 2025 which, if met, would be a major 342% increase on its sales over the past 12 months. The loss per share is anticipated to greatly reduce in the near future, narrowing 80% to CA$0.11. Yet prior to the latest estimates, the analysts had been forecasting revenues of CA$158m and losses of CA$0.11 per share in 2025. 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.

Check out our latest analysis for Exro Technologies

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Exro Technologies' past performance and to peers in the same industry. The analysts are definitely expecting Exro Technologies' growth to accelerate, with the forecast 228% annualised growth to the end of 2025 ranking favourably alongside historical growth of 90% per annum over the past five years. Compare this with other companies in the same industry, which are forecast to grow their revenue 17% annually. It seems obvious that, while the growth outlook is brighter than the recent past, the analysts also expect Exro Technologies to grow faster than the wider industry.

The Bottom Line

Unfortunately, analysts also downgraded their revenue estimates, although our data indicates revenues are expected to perform better than the wider market. Given the stark change in sentiment, we'd understand if investors became more cautious on Exro Technologies after today.

As you can see, the analysts clearly aren't bullish, and there might be good reason for that. We've identified some potential issues with Exro Technologies' financials, such as major dilution from new stock issuance in the past year. For more information, you can click here to discover this and the 2 other flags we've identified.

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 with high insider ownership.

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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.