These Analysts Just Made A Huge Downgrade To Their Genovis AB (publ.) (STO:GENO) EPS Forecasts

Today is shaping up negative for Genovis AB (publ.) (STO:GENO) shareholders, with the analysts delivering a substantial negative revision to this year's forecasts. Revenue and earnings per share (EPS) forecasts were both revised downwards, with analysts seeing grey clouds on the horizon.

Following the downgrade, the latest consensus from Genovis AB (publ.)'s three analysts is for revenues of kr163m in 2024, which would reflect a modest 3.0% improvement in sales compared to the last 12 months. Statutory earnings per share are anticipated to nosedive 49% to kr0.48 in the same period. Prior to this update, the analysts had been forecasting revenues of kr221m and earnings per share (EPS) of kr1.55 in 2024. It looks like analyst sentiment has declined substantially, with a sizeable cut to revenue estimates and a pretty serious decline to earnings per share numbers as well.

View our latest analysis for Genovis AB (publ.)

It'll come as no surprise then, to learn that the analysts have cut their price target 7.5% to kr68.00.

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. It's pretty clear that there is an expectation that Genovis AB (publ.)'s revenue growth will slow down substantially, with revenues to the end of 2024 expected to display 3.0% growth on an annualised basis. This is compared to a historical growth rate of 28% over the past five years. Compare this against other companies (with analyst forecasts) in the industry, which are in aggregate expected to see revenue growth of 11% annually. Factoring in the forecast slowdown in growth, it seems obvious that Genovis AB (publ.) is also expected to grow slower than other industry participants.

The Bottom Line

The most important thing to take away is that analysts cut their earnings per share estimates, expecting a clear decline in business conditions. Regrettably, they also downgraded their revenue estimates, and the latest forecasts imply the business will grow sales slower than 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.

With that said, the long-term trajectory of the company's earnings is a lot more important than next year. We have estimates - from multiple Genovis AB (publ.) analysts - going out to 2026, and you can see them 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.