The Consensus EPS Estimates For Hexagon Purus ASA (OB:HPUR) Just Fell Dramatically

Market forces rained on the parade of Hexagon Purus ASA (OB:HPUR) shareholders today, when the analysts downgraded their forecasts for this year. Both revenue and earnings per share (EPS) forecasts went under the knife, suggesting analysts have soured majorly on the business.

After the downgrade, the consensus from Hexagon Purus' five analysts is for revenues of kr1.7b in 2025, which would reflect a noticeable 7.3% decline in sales compared to the last year of performance. The loss per share is anticipated to greatly reduce in the near future, narrowing 21% to kr2.03. However, before this estimates update, the consensus had been expecting revenues of kr3.0b and kr1.79 per share in losses. So there's been quite a change-up of views after the recent consensus updates, with the analysts making a serious cut to their revenue forecasts while also expecting losses per share to increase.

View our latest analysis for Hexagon Purus

The consensus price target fell 45% to kr4.03, implicitly signalling that lower earnings per share are a leading indicator for Hexagon Purus' 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. These estimates imply that sales are expected to slow, with a forecast annualised revenue decline of 7.3% by the end of 2025. This indicates a significant reduction from annual growth of 47% over the last five years. Compare this with our data, which suggests that other companies in the same industry are, in aggregate, expected to see their revenue grow 12% per year. It's pretty clear that Hexagon Purus' revenues are expected to perform substantially worse than the wider industry.

The Bottom Line

The most important thing to note from this downgrade is that the consensus increased its forecast losses this year, suggesting all may not be well at Hexagon Purus. Regrettably, they also downgraded their revenue estimates, and the latest forecasts imply the business will grow sales slower than the wider market. With a serious cut to this year's expectations and a falling price target, we wouldn't be surprised if investors were becoming wary of Hexagon Purus.

That said, the analysts might have good reason to be negative on Hexagon Purus, given major dilution from new stock issuance in the past year. Learn more, and discover the 3 other concerns we've identified, for free on our platform here.

Another way to search for interesting companies that could be reaching an inflection point is to track whether management are buying or selling, with our free list of growing companies backed by insiders.

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.