IG Design Group plc (LON:IGR) Analysts Just Trimmed Their Revenue Forecasts By 15%

Today is shaping up negative for IG Design Group plc (LON:IGR) shareholders, with the analysts delivering a substantial negative revision to this year's forecasts. This report focused on revenue estimates, and it looks as though the consensus view of the business has become substantially more conservative. At UK£5.98, shares are up 7.9% in the past 7 days. Investors could be forgiven for changing their mind on the business following the downgrade; but it's not clear if the revised forecasts will lead to selling activity.

Following the latest downgrade, the four analysts covering IG Design Group provided consensus estimates of US$526m revenue in 2021, which would reflect a sizeable 31% decline on its sales over the past 12 months. Prior to the latest estimates, the analysts were forecasting revenues of US$619m in 2021. The consensus view seems to have become more pessimistic on IG Design Group, noting the measurable cut to revenue estimates in this update.

Check out our latest analysis for IG Design Group

One way to get more context on these forecasts is to look at how they compare to both past performance, and how other companies in the same industry are performing. We would highlight that sales are expected to reverse, with the forecast 31% revenue decline a notable change from historical growth of 16% over the last five years. By contrast, our data suggests that other companies (with analyst coverage) in the same industry are forecast to see their revenue grow 11% annually for the foreseeable future. It's pretty clear that IG Design Group's revenues are expected to perform substantially worse than the wider industry.

The Bottom Line

The clear low-light was that analysts slashing their revenue forecasts for IG Design Group this year. They're also anticipating slower revenue growth 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 IG Design Group after today.

Unanswered questions? We have estimates for IG Design Group from its four analysts out until 2023, and you can see them free on our platform here.

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