One Analyst Just Shaved Their Impact Coatings AB (publ) (STO:IMPC) Forecasts Dramatically

The latest analyst coverage could presage a bad day for Impact Coatings AB (publ) (STO:IMPC), 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 latest downgrade, the lone analyst covering Impact Coatings provided consensus estimates of kr91m revenue in 2024, which would reflect a concerning 22% decline on its sales over the past 12 months. Per-share losses are expected to creep up to kr0.40. Yet before this consensus update, the analyst had been forecasting revenues of kr123m and losses of kr0.30 per share in 2024. Ergo, there's been a clear change in sentiment, with the analyst administering a notable cut to this year's revenue estimates, while at the same time increasing their loss per share forecasts.

Check out our latest analysis for Impact Coatings

The consensus price target fell 18% to kr5.60, with the analyst clearly concerned about the company following the weaker revenue and earnings outlook.

Another way we can view these estimates is in the context of the bigger picture, such as how the forecasts stack up against past performance, and whether forecasts are more or less bullish relative to other companies in the industry. We would highlight that sales are expected to reverse, with a forecast 22% annualised revenue decline to the end of 2024. That is a notable change from historical growth of 22% 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 3.1% per year. It's pretty clear that Impact Coatings' 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 increased their loss per share estimates for this year. Unfortunately the analyst also downgraded their revenue estimates, and industry data suggests that Impact Coatings' 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 Impact Coatings.

As you can see, this broker clearly isn't bullish, and there might be good reason for that. We've identified some potential issues with Impact Coatings' financials, such as major dilution from new stock issuance in the past year. For more information, you can click here to discover this and the 1 other risk 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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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.