Need To Know: The Consensus Just Cut Its Trent Limited (NSE:TRENT) Estimates For 2022

One thing we could say about the analysts on Trent Limited (NSE:TRENT) - they aren't optimistic, having just made a major negative revision to their near-term (statutory) forecasts for the organization. There was a fairly draconian cut to their revenue estimates, perhaps an implicit admission that previous forecasts were much too optimistic.

After the downgrade, the five analysts covering Trent are now predicting revenues of ₹37b in 2022. If met, this would reflect a major 34% improvement in sales compared to the last 12 months. Before the latest update, the analysts were foreseeing ₹43b of revenue in 2022. It looks like forecasts have become a fair bit less optimistic on Trent, given the measurable cut to revenue estimates.

View our latest analysis for Trent

Of course, another way to look at these forecasts is to place them into context against the industry itself. The analysts are definitely expecting Trent's growth to accelerate, with the forecast 34% annualised growth to the end of 2022 ranking favourably alongside historical growth of 11% per annum over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to grow their revenue at 9.6% per year. It seems obvious that, while the growth outlook is brighter than the recent past, the analysts also expect Trent to grow faster than the wider industry.

The Bottom Line

The most important thing to take away is that analysts cut their revenue estimates for this year. They're also forecasting more rapid revenue growth than the wider market. Often, one downgrade can set off a daisy-chain of cuts, especially if an industry is in decline. So we wouldn't be surprised if the market became a lot more cautious on Trent after today.

Looking to learn more? We have estimates for Trent from its five analysts out until 2023, 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 that insiders are buying.

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