Downgrade: Here's How This Analyst Sees ArcticZymes Technologies ASA (OB:AZT) Performing In The Near Term

The analyst covering ArcticZymes Technologies ASA (OB:AZT) delivered a dose of negativity to shareholders today, by making a substantial revision to their statutory forecasts for this year. Both revenue and earnings per share (EPS) estimates were cut sharply as the analyst factored in the latest outlook for the business, concluding that they were too optimistic previously.

Following the latest downgrade, ArcticZymes Technologies' solitary analyst currently expects revenues in 2023 to be kr137m, approximately in line with the last 12 months. Statutory earnings per share are anticipated to nosedive 28% to kr0.47 in the same period. Before this latest update, the analyst had been forecasting revenues of kr152m and earnings per share (EPS) of kr0.63 in 2023. It looks like analyst sentiment has declined substantially, with a substantial drop in revenue estimates and a large cut to earnings per share numbers as well.

See our latest analysis for ArcticZymes Technologies

The consensus price target fell 16% to kr42.00, with the weaker earnings outlook clearly leading analyst valuation estimates.

One way to get more context on these forecasts is to look at how they compare to both past performance, and how other companies in the same industry are performing. These estimates imply that sales are expected to slow, with a forecast annualised revenue decline of 0.8% by the end of 2023. This indicates a significant reduction from annual growth of 19% 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 2.1% annually for the foreseeable future. It's pretty clear that ArcticZymes Technologies' revenues are expected to perform substantially worse than the wider industry.

The Bottom Line

The most important thing to take away is that the analyst cut their earnings per share estimates, expecting a clear decline in business conditions. Unfortunately the analyst also downgraded their revenue estimates, and industry data suggests that ArcticZymes Technologies' revenues are expected to grow 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 ArcticZymes Technologies.

With that said, the long-term trajectory of the company's earnings is a lot more important than next year. We have analyst estimates for ArcticZymes Technologies 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.

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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.