One Acuvi AB (STO:ACUVI) Broker Just Cut Their Revenue Forecasts By 13%

Today is shaping up negative for Acuvi AB (STO:ACUVI) shareholders, with the covering analyst delivering a substantial negative revision to this year's forecasts. There was a fairly draconian cut to their revenue estimates, perhaps an implicit admission that previous forecasts were much too optimistic.

Following the downgrade, the most recent consensus for Acuvi from its single analyst is for revenues of kr192m in 2023 which, if met, would be an okay 3.7% increase on its sales over the past 12 months. Prior to the latest estimates, the analyst was forecasting revenues of kr221m in 2023. The consensus view seems to have become more pessimistic on Acuvi, noting the substantial drop in revenue estimates in this update.

View our latest analysis for Acuvi

The consensus price target fell 31% to kr25.00, with the analyst clearly less optimistic about Acuvi's valuation following this update.

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. We would highlight that Acuvi's revenue growth is expected to slow, with the forecast 3.7% annualised growth rate until the end of 2023 being well below the historical 44% p.a. growth over the last five years. By way of comparison, the other companies in this industry with analyst coverage are forecast to grow their revenue at 22% per year. So it's pretty clear that, while revenue growth is expected to slow down, the wider industry is also expected to grow faster than Acuvi.

The Bottom Line

The clear low-light was that the analyst slashing their revenue forecasts for Acuvi this year. They also expect company revenue to perform worse than the wider market. Furthermore, there was a cut to the price target, suggesting that the latest news has led to more pessimism about the intrinsic value of the business. 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 Acuvi after today.

Unanswered questions? One Acuvi broker/analyst has provided estimates out to 2025, which can be seen 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 that insiders are buying.

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