Downgrade: The Latest Revenue And EPS Forecasts For Tourn International AB (publ) (STO:TOURN)

One thing we could say about the covering analyst on Tourn International AB (publ) (STO:TOURN) - they aren't optimistic, having just made a major negative revision to their near-term (statutory) forecasts for the organization. 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.

After this downgrade, Tourn International's sole analyst is now forecasting revenues of kr174m in 2022. This would be a huge 22% improvement in sales compared to the last 12 months. The loss per share is anticipated to greatly reduce in the near future, narrowing 46% to kr1.00. Before this latest update, the analyst had been forecasting revenues of kr208m and earnings per share (EPS) of kr0.60 in 2022. So we can see that the consensus has become notably more bearish on Tourn International's outlook with these numbers, making a substantial drop in this year's revenue estimates. Furthermore, they expect the business to be loss-making this year, compared to their previous forecasts of a profit.

See our latest analysis for Tourn International

The consensus price target fell 13% to kr58.00, with the analyst clearly concerned about the company following the weaker revenue and earnings outlook.

Of course, another way to look at these forecasts is to place them into context against the industry itself. We can infer from the latest estimates that forecasts expect a continuation of Tourn International'shistorical trends, as the 22% annualised revenue growth to the end of 2022 is roughly in line with the 25% annual revenue growth over the past five years. Compare this with the broader industry, which analyst estimates (in aggregate) suggest will see revenues grow 20% annually. It's clear that while Tourn International's revenue growth is expected to continue on its current trajectory, it's only expected to grow in line with the industry itself.

The Bottom Line

The biggest low-light for us was that the forecasts for Tourn International dropped from profits to a loss this year. There was also a drop in their revenue estimates, although as we saw earlier, forecast growth is only expected to be about the same as the wider market. Given the scope of the downgrades, it would not be a surprise to see the market become more wary of the business.

Even so, the longer term trajectory of the business is much more important for the value creation of shareholders. At least one analyst has provided forecasts out to 2024, 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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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.