Analyst Forecasts Just Became More Bearish On GoGold Resources Inc. (TSE:GGD)

Market forces rained on the parade of GoGold Resources Inc. (TSE:GGD) shareholders today, when the analysts downgraded their forecasts for this year. Revenue estimates were cut sharply as analysts signalled a weaker outlook - perhaps a sign that investors should temper their expectations as well.

After this downgrade, GoGold Resources' four analysts are now forecasting revenues of US$37m in 2024. This would be a huge 28% improvement in sales compared to the last 12 months. Prior to the latest estimates, the analysts were forecasting revenues of US$43m in 2024. The consensus view seems to have become more pessimistic on GoGold Resources, noting the substantial drop in revenue estimates in this update.

See our latest analysis for GoGold Resources

We'd point out that there was no major changes to their price target of CA$3.00, suggesting the latest estimates were not enough to shift their view on the value of the business.

Of course, another way to look at these forecasts is to place them into context against the industry itself. It's clear from the latest estimates that GoGold Resources' rate of growth is expected to accelerate meaningfully, with the forecast 39% annualised revenue growth to the end of 2024 noticeably faster than its historical growth of 5.5% p.a. over the past five years. Compare this with other companies in the same industry, which are forecast to grow their revenue 13% annually. Factoring in the forecast acceleration in revenue, it's pretty clear that GoGold Resources is expected to grow much faster than its industry.

The Bottom Line

The most important thing to take away is that analysts cut their revenue estimates for this year. The analysts also expect revenues to grow faster than the wider market. Often, one downgrade can set off a daisy-chain of cuts, especially if an industry is in decline. So we wouldn't be surprised if the market became a lot more cautious on GoGold Resources after today.

Want to learn more? At least one of GoGold Resources' four analysts has provided estimates out to 2026, which can be seen for 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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

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.