Analysts Just Slashed Their Nordic Semiconductor ASA (OB:NOD) EPS Numbers

The analysts covering Nordic Semiconductor ASA (OB:NOD) delivered a dose of negativity to shareholders today, by making a substantial revision to their statutory forecasts for next year. Both revenue and earnings per share (EPS) forecasts went under the knife, suggesting the analysts have soured majorly on the business.

Following the latest downgrade, the ten analysts covering Nordic Semiconductor provided consensus estimates of US$591m revenue in 2024, which would reflect a small 5.6% decline on its sales over the past 12 months. Statutory earnings per share are supposed to plunge 44% to US$0.15 in the same period. Before this latest update, the analysts had been forecasting revenues of US$660m and earnings per share (EPS) of US$0.28 in 2024. Indeed, we can see that the analysts are a lot more bearish about Nordic Semiconductor's prospects, administering a measurable cut to revenue estimates and slashing their EPS estimates to boot.

Check out our latest analysis for Nordic Semiconductor

It'll come as no surprise then, to learn that the analysts have cut their price target 15% to kr110.

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 4.5% by the end of 2024. This indicates a significant reduction from annual growth of 24% 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 10% annually for the foreseeable future. So although its revenues are forecast to shrink, this cloud does not come with a silver lining - Nordic Semiconductor is expected to lag the wider industry.

The Bottom Line

The biggest issue in the new estimates is that analysts have reduced their earnings per share estimates, suggesting business headwinds lay ahead for Nordic Semiconductor. Regrettably, they also downgraded their revenue estimates, and the latest forecasts imply the business will grow sales slower than the wider market. After such a stark change in sentiment from analysts, we'd understand if readers now felt a bit wary of Nordic Semiconductor.

After a downgrade like this, it's pretty clear that previous forecasts were too optimistic. What's more, we've spotted several possible issues with Nordic Semiconductor's business, like concerns around earnings quality. For more information, you can click here to discover this and the 2 other concerns we've identified.

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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