Analysts Just Slashed Their Sivers Semiconductors AB (publ) (STO:SIVE) EPS Numbers

Market forces rained on the parade of Sivers Semiconductors AB (publ) (STO:SIVE) shareholders today, when the analysts downgraded their forecasts for this year. Both revenue and earnings per share (EPS) forecasts went under the knife, suggesting analysts have soured majorly on the business.

After this downgrade, Sivers Semiconductors' three analysts are now forecasting revenues of kr186m in 2022. This would be a huge 26% improvement in sales compared to the last 12 months. Per-share losses are expected to creep up to kr0.82. However, before this estimates update, the consensus had been expecting revenues of kr312m and kr0.30 per share in losses. Ergo, there's been a clear change in sentiment, with the analysts 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 Sivers Semiconductors

The consensus price target fell 16% to kr27.50, implicitly signalling that lower earnings per share are a leading indicator for Sivers Semiconductors' valuation. That's not the only conclusion we can draw from this data however, as some investors also like to consider the spread in estimates when evaluating analyst price targets. The most optimistic Sivers Semiconductors analyst has a price target of kr38.00 per share, while the most pessimistic values it at kr21.00. This is a fairly broad spread of estimates, suggesting that the analysts are forecasting a wide range of possible outcomes for the business.

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Sivers Semiconductors' past performance and to peers in the same industry. It's clear from the latest estimates that Sivers Semiconductors' rate of growth is expected to accelerate meaningfully, with the forecast 26% annualised revenue growth to the end of 2022 noticeably faster than its historical growth of 20% p.a. over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to grow their revenue at 11% per year. It seems obvious that, while the growth outlook is brighter than the recent past, the analysts also expect Sivers Semiconductors to grow faster than the wider industry.

The Bottom Line

The most important thing to note from this downgrade is that the consensus increased its forecast losses this year, suggesting all may not be well at Sivers Semiconductors. While analysts did downgrade their revenue estimates, these forecasts still imply revenues will perform better than the wider market. After such a stark change in sentiment from analysts, we'd understand if readers now felt a bit wary of Sivers Semiconductors.

That said, the analysts might have good reason to be negative on Sivers Semiconductors, given a short cash runway. Learn more, and discover the 2 other risks we've identified, for free on our platform here.

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.