Altius Minerals Corporation (TSE:ALS) Analysts Are Reducing Their Forecasts For Next Year

One thing we could say about the analysts on Altius Minerals Corporation (TSE:ALS) - they aren't optimistic, having just made a major negative revision to their near-term (statutory) forecasts for the organization. Both revenue and earnings per share (EPS) forecasts went under the knife, suggesting the analysts have soured majorly on the business.

Following the downgrade, the consensus from five analysts covering Altius Minerals is for revenues of CA$74m in 2023, implying a concerning 28% decline in sales compared to the last 12 months. Statutory earnings per share are anticipated to plunge 21% to CA$0.56 in the same period. Previously, the analysts had been modelling revenues of CA$83m and earnings per share (EPS) of CA$0.74 in 2023. It looks like analyst sentiment has declined substantially, with a substantial drop in revenue estimates and a pretty serious decline to earnings per share numbers as well.

Check out our latest analysis for Altius Minerals

Analysts made no major changes to their price target of CA$24.88, suggesting the downgrades are not expected to have a long-term impact on Altius Minerals' valuation. 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 Altius Minerals, with the most bullish analyst valuing it at CA$30.00 and the most bearish at CA$21.00 per share. There are definitely some different views on the stock, but the range of estimates is not wide enough as to imply that the situation is unforecastable, in our view.

Of course, another way to look at these forecasts is to place them into context against the industry itself. These estimates imply that sales are expected to slow, with a forecast annualised revenue decline of 23% by the end of 2023. This indicates a significant reduction from annual growth of 17% over the last five years. Compare this with our data, which suggests that other companies in the same industry are, in aggregate, expected to see their revenue grow 11% per year. It's pretty clear that Altius Minerals' revenues are expected to perform substantially worse than the wider 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 Altius Minerals. Unfortunately analysts also downgraded their revenue estimates, and industry data suggests that Altius Minerals' revenues are expected to grow slower than the wider market. We're also surprised to see that the price target went unchanged. Still, deteriorating business conditions (assuming accurate forecasts!) can be a leading indicator for the stock price, so we wouldn't blame investors for being more cautious on Altius Minerals after the downgrade.

There might be good reason for analyst bearishness towards Altius Minerals, like recent substantial insider selling. For more information, you can click here to discover this and the 3 other warning signs 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 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.