Analysts Have Just Cut Their Ovzon AB (publ) (STO:OVZON) Revenue Estimates By 11%

Today is shaping up negative for Ovzon AB (publ) (STO:OVZON) shareholders, with the analysts 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.

After this downgrade, Ovzon's dual analysts are now forecasting revenues of kr322m in 2024. This would be an okay 3.2% improvement in sales compared to the last 12 months. Losses are supposed to balloon 92% to kr1.31 per share. Yet before this consensus update, the analysts had been forecasting revenues of kr363m and losses of kr1.20 per share in 2024. 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.

View our latest analysis for Ovzon

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 Ovzon's revenue growth is expected to slow, with the forecast 6.5% annualised growth rate until the end of 2024 being well below the historical 12% p.a. growth over the last five years. Juxtapose this against the other companies in the industry with analyst coverage, which are forecast to grow their revenues (in aggregate) 2.3% per year. Even after the forecast slowdown in growth, it seems obvious that Ovzon is also expected to grow faster than the wider industry.

The Bottom Line

The most important thing to take away is that analysts increased their loss per share estimates for this year. While analysts did downgrade their revenue estimates, these forecasts still imply revenues will perform better than the wider market. Overall, given the drastic downgrade to this year's forecasts, we'd be feeling a little more wary of Ovzon going forwards.

So things certainly aren't looking great, and you should also know that we've spotted some potential warning signs with Ovzon, including major dilution from new stock issuance in the past year. Learn more, and discover the 2 other flags we've identified, 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 backed by insiders.

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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.