One Tekmar Group plc (LON:TGP) Broker Analyst Just Cut Their Revenue Numbers By 17%

The latest analyst coverage could presage a bad day for Tekmar Group plc (LON:TGP), 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.

Following the latest downgrade, the lone analyst covering Tekmar Group provided consensus estimates of UK£35m revenue in 2022, which would reflect a chunky 10% decline on its sales over the past 12 months. After this downgrade, the company is anticipated to report a loss of UK£0.02 in 2022, a sharp decline from a profit over the last year. Before this latest update, the analyst had been forecasting revenues of UK£42m and earnings per share (EPS) of UK£0.032 in 2022. There looks to have been a major change in sentiment regarding Tekmar Group's prospects, with a substantial drop in revenues and the analyst now forecasting a loss instead of a profit.

View our latest analysis for Tekmar Group

The consensus price target fell 17% to UK£0.75, with the analyst clearly concerned about the company following the weaker revenue and earnings outlook.

Of course, another way to look at these forecasts is to place them into context against the industry itself. We would highlight that sales are expected to reverse, with a forecast 10% annualised revenue decline to the end of 2022. That is a notable change from historical growth of 2.7% over the last year. Compare this with our data, which suggests that other companies in the same industry are, in aggregate, expected to see their revenue grow 5.4% per year. It's pretty clear that Tekmar Group's revenues are expected to perform substantially worse than the wider industry.

The Bottom Line

The biggest low-light for us was that the forecasts for Tekmar Group dropped from profits to a loss this year. Regrettably, they also downgraded their revenue estimates, and the latest forecasts imply the business will grow sales slower than the wider market. After such a stark change in sentiment from the analyst, we'd understand if readers now felt a bit wary of Tekmar Group.

With that said, the long-term trajectory of the company's earnings is a lot more important than next year. At least one analyst has provided forecasts out to 2024, which can be seen for 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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