Need To Know: Analysts Just Made A Substantial Cut To Their Treatt plc (LON:TET) Estimates

The analysts covering Treatt plc (LON:TET) delivered a dose of negativity to shareholders today, by making a substantial revision to their statutory forecasts for this year. Revenue and earnings per share (EPS) forecasts were both revised downwards, with the analysts seeing grey clouds on the horizon.

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Following the latest downgrade, the six analysts covering Treatt provided consensus estimates of UK£130m revenue in 2025, which would reflect an uncomfortable 10% decline on its sales over the past 12 months. Statutory earnings per share are anticipated to tumble 42% to UK£0.11 in the same period. Prior to this update, the analysts had been forecasting revenues of UK£134m and earnings per share (EPS) of UK£0.14 in 2025. The forecasts seem less optimistic after the new consensus numbers, with lower sales estimates and making a large cut to earnings per share forecasts.

View our latest analysis for Treatt

Another way we can view these estimates is in the context of the bigger picture, such as how the forecasts stack up against past performance, and whether forecasts are more or less bullish relative to other companies in the industry. We would highlight that sales are expected to reverse, with a forecast 10% annualised revenue decline to the end of 2025. That is a notable change from historical growth of 7.0% over the last five years. By contrast, our data suggests that other companies (with analyst coverage) in the industry are forecast to see their revenue decline 15% annually for the foreseeable future. So it's pretty clear that Treatt's revenues are expected to shrink slower than 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. Unfortunately, they also downgraded their revenue estimates, and our data indicates sales are expected to outperform the wider market. Even so, earnings per share are more important to the intrinsic value of the business. 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 Treatt, and their negativity could be grounds for caution.

With that said, the long-term trajectory of the company's earnings is a lot more important than next year. At Simply Wall St, we have a full range of analyst estimates for Treatt going out to 2027, 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 with high insider ownership.

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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.