Analysts Have Just Cut Their Nicox S.A. (EPA:COX) Revenue Estimates By 11%

Today is shaping up negative for Nicox S.A. (EPA:COX) shareholders, with the analysts delivering a substantial negative revision to this year's forecasts. There was a fairly draconian cut to their revenue estimates, perhaps an implicit admission that previous forecasts were much too optimistic.

After this downgrade, Nicox's three analysts are now forecasting revenues of €15m in 2021. This would be a notable 18% improvement in sales compared to the last 12 months. Losses are expected to be contained, narrowing 18% from last year to €0.51. However, before this estimates update, the consensus had been expecting revenues of €17m and €0.45 per share in losses. Ergo, there's been a clear change in sentiment, with the analysts administering a notable cut to this year's revenue estimates, while at the same time increasing their loss per share forecasts.

View our latest analysis for Nicox

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 Nicox's revenue growth is expected to slow, with the forecast 18% annualised growth rate until the end of 2021 being well below the historical 55% p.a. growth over the last five years. Compare this against other companies (with analyst forecasts) in the industry, which are in aggregate expected to see revenue growth of 33% annually. So it's pretty clear that, while revenue growth is expected to slow down, the wider industry is also expected to grow faster than Nicox.

The Bottom Line

The most important thing to take away is that analysts increased their loss per share estimates for this year. Regrettably, they also downgraded their revenue estimates, and the latest forecasts imply the business will grow sales slower than the wider market. Overall, given the drastic downgrade to this year's forecasts, we'd be feeling a little more wary of Nicox going forwards.

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 Nicox's financials, such as dilutive stock issuance over the past year. Learn more, and discover the 3 other risks we've identified, 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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