One Analyst Just Downgraded Their ENENSYS Technologies SA (EPA:ALNN6) Forecasts

The latest analyst coverage could presage a bad day for ENENSYS Technologies SA (EPA:ALNN6), with the covering analyst making across-the-board cuts to their statutory estimates that might leave shareholders a little shell-shocked. Both revenue and earnings per share (EPS) forecasts went under the knife, suggesting the analyst has soured majorly on the business.

After the downgrade, the single analyst covering ENENSYS Technologies is now predicting revenues of €13m in 2022. If met, this would reflect a credible 5.6% improvement in sales compared to the last 12 months. After this downgrade, the company is anticipated to report a loss of €0.01 in 2022, a sharp decline from a profit over the last year. Previously, the analyst had been modelling revenues of €15m and earnings per share (EPS) of €0.04 in 2022. There looks to have been a major change in sentiment regarding ENENSYS Technologies' prospects, with a measurable cut to revenues and the analyst now forecasting a loss instead of a profit.

View our latest analysis for ENENSYS Technologies

Of course, another way to look at these forecasts is to place them into context against the industry itself. One thing stands out from these estimates, which is that ENENSYS Technologies is forecast to grow faster in the future than it has in the past, with revenues expected to display 5.6% annualised growth until the end of 2022. If achieved, this would be a much better result than the 7.0% annual decline over the past five years. Compare this against analyst estimates for the broader industry, which suggest that (in aggregate) industry revenues are expected to grow 6.3% annually. So while ENENSYS Technologies' revenues are expected to improve, it seems that it is expected to grow at about the same rate as the overall industry.

The Bottom Line

The most important thing to take away is that the analyst is expecting ENENSYS Technologies to become unprofitable this year. There was also a drop in their revenue estimates, although as we saw earlier, forecast growth is only expected to be about the same as the wider market. Given the serious cut to this year's outlook, it's clear that the analyst has turned more bearish on ENENSYS Technologies, and we wouldn't blame shareholders for feeling a little more cautious themselves.

Still, the long-term prospects of the business are much more relevant than next year's earnings. We have analyst estimates for ENENSYS Technologies going out as far as 2024, 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.

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.