One Analyst Just Shaved Their Cambi ASA (OB:CAMBI) Forecasts Dramatically

The latest analyst coverage could presage a bad day for Cambi ASA (OB:CAMBI), with the covering analyst making across-the-board cuts to their statutory estimates that might leave shareholders a little shell-shocked. Revenue and earnings per share (EPS) forecasts were both revised downwards, with the analyst seeing grey clouds on the horizon.

Following the downgrade, the current consensus from Cambi's lone analyst is for revenues of kr510m in 2022 which - if met - would reflect a meaningful 9.5% increase on its sales over the past 12 months. Statutory earnings per share are anticipated to dive 25% to kr0.20 in the same period. Before this latest update, the analyst had been forecasting revenues of kr578m and earnings per share (EPS) of kr0.40 in 2022. Indeed, we can see that the analyst is a lot more bearish about Cambi's prospects, administering a substantial drop in revenue estimates and slashing their EPS estimates to boot.

See our latest analysis for Cambi

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. It's pretty clear that there is an expectation that Cambi's revenue growth will slow down substantially, with revenues to the end of 2022 expected to display 7.6% growth on an annualised basis. This is compared to a historical growth rate of 13% over the past three years. Compare this against other companies (with analyst forecasts) in the industry, which are in aggregate expected to see revenue growth of 36% annually. So it's pretty clear that, while revenue growth is expected to slow down, the wider industry is also expected to grow faster than Cambi.

The Bottom Line

The biggest issue in the new estimates is that the analyst has reduced their earnings per share estimates, suggesting business headwinds lay ahead for Cambi. Unfortunately the analyst also downgraded their revenue estimates, and industry data suggests that Cambi's revenues are expected to grow slower than the wider market. Given the serious cut to next year's outlook, it's clear that the analyst has turned more bearish on Cambi, and we wouldn't blame shareholders for feeling a little more cautious themselves.

So things certainly aren't looking great, and you should also know that we've spotted some potential warning signs with Cambi, including concerns around earnings quality. Learn more, and discover the 1 other flag we've identified, for free on our platform here.

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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.