What You Need To Know About The Sylvania Platinum Limited (LON:SLP) Analyst Downgrade Today

The analysts covering Sylvania Platinum Limited (LON:SLP) delivered a dose of negativity to shareholders today, by making a substantial revision to their statutory 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 downgrade, the consensus from twin analysts covering Sylvania Platinum is for revenues of US$139m in 2023, implying an uncomfortable 15% decline in sales compared to the last 12 months. Prior to the latest estimates, the analysts were forecasting revenues of US$170m in 2023. The consensus view seems to have become more pessimistic on Sylvania Platinum, noting the substantial drop in revenue estimates in this update.

View our latest analysis for Sylvania Platinum

The consensus price target fell 12% to AU$2.31, with the analysts clearly less optimistic about Sylvania Platinum's valuation following this update.

One way to get more context on these forecasts is to look at how they compare to both past performance, and how other companies in the same industry are performing. These estimates imply that sales are expected to slow, with a forecast annualised revenue decline of 15% by the end of 2023. This indicates a significant reduction from annual growth of 25% over the last five years. Yet aggregate analyst estimates for other companies in the industry suggest that industry revenues are forecast to decline 1.3% per year. So it's pretty clear that Sylvania Platinum's revenues are expected to shrink faster than the wider industry.

The Bottom Line

The clear low-light was that analysts slashing their revenue forecasts for Sylvania Platinum this year. The analysts also expect revenues to shrink faster than the wider market. The consensus price target fell measurably, with analysts seemingly not reassured by recent business developments, leading to a lower estimate of Sylvania Platinum's future valuation. Given the stark change in sentiment, we'd understand if investors became more cautious on Sylvania Platinum after today.

Need some more information? We have estimates for Sylvania Platinum from its twin analysts out until 2025, and you can see them free on our platform here.

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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.