What You Need To Know About The Rockhopper Exploration plc (LON:RKH) Analyst Downgrade Today

Market forces rained on the parade of Rockhopper Exploration plc (LON:RKH) shareholders today, when the analysts downgraded their forecasts for this year. This report focused on revenue estimates, and it looks as though the consensus view of the business has become substantially more conservative.

Following the latest downgrade, the current consensus, from the four analysts covering Rockhopper Exploration, is for revenues of US$3.6m in 2020, which would reflect a stressful 55% reduction in Rockhopper Exploration's sales over the past 12 months. Prior to the latest estimates, the analysts were forecasting revenues of US$4.4m in 2020. It looks like forecasts have become a fair bit less optimistic on Rockhopper Exploration, given the measurable cut to revenue estimates.

Check out our latest analysis for Rockhopper Exploration

Of course, another way to look at these forecasts is to place them into context against the industry itself. Over the past three years, revenues have declined around 3.4% annually. Worse, forecasts are essentially predicting the decline to accelerate, with the estimate for a 55% decline in revenue next year. Compare this against analyst estimates for companies in the wider industry, which suggest that revenues (in aggregate) are expected to grow 12% next year. So while a broad number of companies are forecast to grow, unfortunately Rockhopper Exploration is expected to see its sales affected worse than other companies in the industry.

The Bottom Line

The clear low-light was that analysts slashing their revenue forecasts for Rockhopper Exploration 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 Rockhopper Exploration after today.

Want more information? We have estimates for Rockhopper Exploration from its four analysts out until 2022, and you can see them free on our platform here.

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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