Analyst Forecasts Just Got A Lot More Bearish On SBF AG (FRA:CY1K)

Today is shaping up negative for SBF AG (FRA:CY1K) shareholders, with the analysts delivering a substantial negative revision to this year's forecasts. Both revenue and earnings per share (EPS) forecasts went under the knife, suggesting the analysts have soured majorly on the business.

Following the latest downgrade, SBF's dual analysts currently expect revenues in 2023 to be €34m, approximately in line with the last 12 months. Losses are predicted to fall substantially, shrinking 87% to €0.025 per share. Prior to this update, the analysts had been forecasting revenues of €39m and earnings per share (EPS) of €0.075 in 2023. So we can see that the consensus has become notably more bearish on SBF'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.

Check out our latest analysis for SBF

The consensus price target fell 7.1% to €9.80, with the analysts clearly concerned about the company following the weaker revenue and earnings outlook.

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. We would highlight that SBF's revenue growth is expected to slow, with the forecast 1.1% annualised growth rate until the end of 2023 being well below the historical 20% p.a. growth over the last three years. By way of comparison, the other companies in this industry with analyst coverage are forecast to grow their revenue at 8.9% per year. So it's pretty clear that, while revenue growth is expected to slow down, the wider industry is also expected to grow faster than SBF.

The Bottom Line

The biggest low-light for us was that the forecasts for SBF dropped from profits to a loss this year. Unfortunately analysts also downgraded their revenue estimates, and industry data suggests that SBF's revenues are expected to grow slower than the wider market. Given the scope of the downgrades, it would not be a surprise to see the market become more wary of the business.

Even so, the longer term trajectory of the business is much more important for the value creation of shareholders. At least one analyst has provided forecasts out to 2025, which can be seen for 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.