This Wolverine Energy and Infrastructure Inc. (CVE:WEII) Analyst Just Made A Notable 15% Cut To Their Forecasts

Market forces rained on the parade of Wolverine Energy and Infrastructure Inc. (CVE:WEII) shareholders today, when the covering analyst downgraded their forecasts for this year. Revenue and earnings per share (EPS) forecasts were both revised downwards, with the analyst seeing grey clouds on the horizon.

Following the latest downgrade, the solo analyst covering Wolverine Energy and Infrastructure provided consensus estimates of CA$63m revenue in 2022, which would reflect a sizeable 34% decline on its sales over the past 12 months. The loss per share is anticipated to greatly reduce in the near future, narrowing 65% to CA$0.02. Before this latest update, the analyst had been forecasting revenues of CA$74m and earnings per share (EPS) of CA$0.09 in 2022. So we can see that the consensus has become notably more bearish on Wolverine Energy and Infrastructure's outlook with these numbers, making a substantial drop in this year's revenue estimates. Furthermore, they expect the business to be loss-making this year, compared to their previous forecasts of a profit.

View our latest analysis for Wolverine Energy and Infrastructure

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. These estimates imply that sales are expected to slow, with a forecast annualised revenue decline of 57% by the end of 2022. This indicates a significant reduction from annual growth of 21% over the last three years. By contrast, our data suggests that other companies (with analyst coverage) in the same industry are forecast to see their revenue grow 12% annually for the foreseeable future. It's pretty clear that Wolverine Energy and Infrastructure's revenues are expected to perform substantially worse than the wider industry.

The Bottom Line

The biggest low-light for us was that the forecasts for Wolverine Energy and Infrastructure dropped from profits to a loss this year. Regrettably, they also downgraded their revenue estimates, and the latest forecasts imply the business will grow sales slower than the wider market. After a cut like that, investors could be forgiven for thinking the analyst is a lot more bearish on Wolverine Energy and Infrastructure, and a few readers might choose to steer clear of the stock.

With that said, the long-term trajectory of the company's earnings is a lot more important than next year. We have analyst estimates for Wolverine Energy and Infrastructure going out as far as 2023, and you can see them free on our platform here.

Another way to search for interesting companies that could be reaching an inflection point is to track whether management are buying or selling, with our free list of growing companies 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.