Analysts Are Betting On CLS Holdings plc (LON:CLI) With A Big Upgrade This Week

By
Simply Wall St
Published
March 31, 2021
LSE:CLI

CLS Holdings plc (LON:CLI) shareholders will have a reason to smile today, with the analysts making substantial upgrades to this year's statutory forecasts. The analysts have sharply increased their revenue numbers, with a view that CLS Holdings will make substantially more sales than they'd previously expected.

After the upgrade, the consensus from CLS Holdings' dual analysts is for revenues of UK£130m in 2021, which would reflect a measurable 6.4% decline in sales compared to the last year of performance. Prior to the latest estimates, the analysts were forecasting revenues of UK£113m in 2021. It looks like there's been a clear increase in optimism around CLS Holdings, given the substantial gain in revenue forecasts.

Check out our latest analysis for CLS Holdings

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LSE:CLI Earnings and Revenue Growth March 31st 2021

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 6.4% annualised revenue decline to the end of 2021. That is a notable change from historical growth of 3.5% over the last five years. By contrast, our data suggests that other companies (with analyst coverage) in the same industry are forecast to see their revenue grow 0.4% annually for the foreseeable future. It's pretty clear that CLS Holdings' revenues are expected to perform substantially worse than the wider industry.

The Bottom Line

The highlight for us was that analysts increased their revenue forecasts for CLS Holdings this year. They're also anticipating slower revenue growth than the wider market. Seeing the dramatic upgrade to this year's forecasts, it might be time to take another look at CLS Holdings.

Analysts are clearly in love with CLS Holdings at the moment, but before diving in - you should be aware that we've identified some warning flags with the business, such as its declining profit margins. For more information, you can click through to our platform to learn more about this and the 3 other warning signs we've identified .

Of course, seeing company management invest large sums of money in a stock can be just as useful as knowing whether analysts are upgrading 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. 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.
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