Hollywood Bowl Group plc (LON:BOWL) Analysts Just Slashed This Year's Revenue Estimates By 24%

One thing we could say about the analysts on Hollywood Bowl Group plc (LON:BOWL) - they aren't optimistic, having just made a major negative revision to their near-term (statutory) forecasts for the organization. This report focused on revenue estimates, and it looks as though the consensus view of the business has become substantially more conservative.

Following the downgrade, the consensus from seven analysts covering Hollywood Bowl Group is for revenues of UK£59m in 2021, implying a disturbing 26% decline in sales compared to the last 12 months. Before the latest update, the analysts were foreseeing UK£77m of revenue in 2021. It looks like forecasts have become a fair bit less optimistic on Hollywood Bowl Group, given the pretty serious reduction to revenue estimates.

View our latest analysis for Hollywood Bowl Group

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Hollywood Bowl Group's past performance and to peers in the same industry. We would highlight that sales are expected to reverse, with a forecast 26% annualised revenue decline to the end of 2021. That is a notable change from historical growth of 3.2% over the last five years. Compare this with our data, which suggests that other companies in the same industry are, in aggregate, expected to see their revenue grow 13% per year. So although its revenues are forecast to shrink, this cloud does not come with a silver lining - Hollywood Bowl Group is expected to lag the wider industry.

The Bottom Line

The most important thing to take away is that analysts cut their revenue estimates for this year. They also expect company revenue to perform worse than the wider market. Given the stark change in sentiment, we'd understand if investors became more cautious on Hollywood Bowl Group after today.

Unfortunately, by using these new estimates as a starting point, we've run a discounted cash flow calculation (DCF) on Hollywood Bowl Group that suggests the company could be somewhat overvalued. Learn why, and examine the assumptions that underpin our valuation by visiting our free platform here to learn more about our valuation approach.

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.

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