Sylvania Platinum Limited (LON:SLP) Analysts Are Reducing Their Forecasts For This Year

The latest analyst coverage could presage a bad day for Sylvania Platinum Limited (LON:SLP), with the analysts making across-the-board cuts to their statutory estimates that might leave shareholders a little shell-shocked. Both revenue and earnings per share (EPS) estimates were cut sharply as the analysts factored in the latest outlook for the business, concluding that they were too optimistic previously.

Following the latest downgrade, the current consensus, from the two analysts covering Sylvania Platinum, is for revenues of US$112m in 2024, which would reflect a definite 14% reduction in Sylvania Platinum's sales over the past 12 months. Statutory earnings per share are supposed to plunge 33% to US$0.12 in the same period. Prior to this update, the analysts had been forecasting revenues of US$130m and earnings per share (EPS) of US$0.16 in 2024. Indeed, we can see that the analysts are a lot more bearish about Sylvania Platinum's prospects, administering a measurable cut to revenue estimates and slashing their EPS estimates to boot.

Check out our latest analysis for Sylvania Platinum

Analysts made no major changes to their price target of AU$1.85, suggesting the downgrades are not expected to have a long-term impact on Sylvania Platinum's valuation.

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Sylvania Platinum's 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 14% by the end of 2024. This indicates a significant reduction from annual growth of 19% 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 0.4% per year. So although its revenues are forecast to shrink, this cloud does not come with a silver lining - Sylvania Platinum is expected to lag the wider industry.

The Bottom Line

The most important thing to take away is that analysts cut their earnings per share estimates, expecting a clear decline in business conditions. Regrettably, they also downgraded their revenue estimates, and the latest forecasts imply the business will grow sales slower than the wider market. The lack of change in the price target is puzzling in light of the downgrade but, with a serious decline expected this year, we wouldn't be surprised if investors were a bit wary of Sylvania Platinum.

Still, the long-term prospects of the business are much more relevant than next year's earnings. We have analyst estimates for Sylvania Platinum going out as far as 2026, and you can see them free on our platform here.

Another way to search for interesting companies that could be reaching an inflection point is to track whether management are buying or selling, with our free list of growing companies 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.