One Analyst Thinks Totens Sparebank's (OB:TOTG) Revenues Are Under Threat

The analyst covering Totens Sparebank (OB:TOTG) 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 latest downgrade, the lone analyst covering Totens Sparebank provided consensus estimates of kr511m revenue in 2023, which would reflect a noticeable 3.2% decline on its sales over the past 12 months. Statutory earnings per share are anticipated to shrink 7.1% to kr23.70 in the same period. Previously, the analyst had been modelling revenues of kr586m and earnings per share (EPS) of kr23.68 in 2023. Indeed we can see that the consensus opinion has undergone some fundamental changes following the recent consensus updates, with a substantial drop in revenues and some minor tweaks to earnings numbers.

Check out our latest analysis for Totens Sparebank

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Totens Sparebank's past performance and to peers in the same industry. These estimates imply that sales are expected to slow, with a forecast annualised revenue decline of 3.2% by the end of 2023. This indicates a significant reduction from annual growth of 5.5% 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 3.7% annually for the foreseeable future. It's pretty clear that Totens Sparebank's revenues are expected to perform substantially worse than the wider industry.

The Bottom Line

The most obvious conclusion from this consensus update is that there's been no major change in the business' prospects in recent times, with the analyst holding earnings per share steady, in line with previous estimates. Unfortunately the analyst also downgraded their revenue estimates, and industry data suggests that Totens Sparebank's revenues are expected to grow slower 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 Totens Sparebank after today.

Even so, the longer term trajectory of the business is much more important for the value creation of shareholders. We have analyst estimates for Totens Sparebank going out as far as 2025, 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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

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.