Time To Worry? Analysts Are Downgrading Their boohoo group plc (LON:DEBS) Outlook

Market forces rained on the parade of boohoo group plc (LON:DEBS) shareholders today, when the analysts downgraded their 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 downgrade, the latest consensus from boohoo group's seven analysts is for revenues of UK£946m in 2026, which would reflect a notable 20% improvement in sales compared to the last 12 months. The loss per share is anticipated to greatly reduce in the near future, narrowing 78% to UK£0.042. However, before this estimates update, the consensus had been expecting revenues of UK£1.1b and UK£0.03 per share in losses. Ergo, there's been a clear change in sentiment, with the analysts administering a notable cut to this year's revenue estimates, while at the same time increasing their loss per share forecasts.

View our latest analysis for boohoo group

The consensus price target fell 12% to UK£0.22, implicitly signalling that lower earnings per share are a leading indicator for boohoo group's valuation.

Taking a look at the bigger picture now, one of the ways we can understand these forecasts is to see how they compare to both past performance and industry growth estimates. One thing stands out from these estimates, which is that boohoo group is forecast to grow faster in the future than it has in the past, with revenues expected to display 20% annualised growth until the end of 2026. If achieved, this would be a much better result than the 5.1% annual decline over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in the industry are forecast to see their revenue grow 3.9% per year. So it looks like boohoo group is expected to grow faster than its competitors, at least for a while.

The Bottom Line

The most important thing to take away is that analysts increased their loss per share estimates for this year. Unfortunately, analysts also downgraded their revenue estimates, although our data indicates revenues are expected to perform better than the wider market. After such a stark change in sentiment from analysts, we'd understand if readers now felt a bit wary of boohoo group.

Even so, the longer term trajectory of the business is much more important for the value creation of shareholders. We have estimates - from multiple boohoo group analysts - going out to 2028, 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.