Some EKF Diagnostics Holdings plc (LON:EKF) Analysts Just Made A Major Cut To Next Year's Estimates

Today is shaping up negative for EKF Diagnostics Holdings plc (LON:EKF) shareholders, with the analysts delivering a substantial negative revision to this year's forecasts. There was a fairly draconian cut to their revenue estimates, perhaps an implicit admission that previous forecasts were much too optimistic.

After the downgrade, the consensus from EKF Diagnostics Holdings' three analysts is for revenues of UK£62m in 2022, which would reflect a disturbing 24% decline in sales compared to the last year of performance. Before the latest update, the analysts were foreseeing UK£69m of revenue in 2022. It looks like forecasts have become a fair bit less optimistic on EKF Diagnostics Holdings, given the measurable cut to revenue estimates.

View our latest analysis for EKF Diagnostics Holdings

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the EKF Diagnostics Holdings' past performance and to peers in the same industry. These estimates imply that sales are expected to slow, with a forecast annualised revenue decline of 24% by the end of 2022. This indicates a significant reduction from annual growth of 16% 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 6.7% per year. It's pretty clear that EKF Diagnostics Holdings' revenues are expected to perform substantially worse than the wider industry.

The Bottom Line

The most important thing to take away is that analysts cut their revenue estimates for this year. They're also anticipating slower revenue growth than the wider market. We wouldn't be surprised to find shareholders feeling a bit shell-shocked, after these downgrades. It looks like analysts have become a lot more bearish on EKF Diagnostics Holdings, and their negativity could be grounds for caution.

Thirsting for more data? We have estimates for EKF Diagnostics Holdings from its three analysts out until 2024, 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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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.