Things Look Grim For Vicor Corporation (NASDAQ:VICR) After Today's Downgrade

Today is shaping up negative for Vicor Corporation (NASDAQ:VICR) shareholders, with the analysts delivering a substantial negative revision to this year's forecasts. Both revenue and earnings per share (EPS) forecasts went under the knife, suggesting analysts have soured majorly on the business.

Following the downgrade, the most recent consensus for Vicor from its twin analysts is for revenues of US$383m in 2022 which, if met, would be a modest 6.8% increase on its sales over the past 12 months. Statutory earnings per share are anticipated to plummet 38% to US$0.66 in the same period. Previously, the analysts had been modelling revenues of US$427m and earnings per share (EPS) of US$1.32 in 2022. Indeed, we can see that the analysts are a lot more bearish about Vicor's prospects, administering a substantial drop in revenue estimates and slashing their EPS estimates to boot.

Check out our latest analysis for Vicor

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Vicor's past performance and to peers in the same industry. The period to the end of 2022 brings more of the same, according to the analysts, with revenue forecast to display 9.1% growth on an annualised basis. That is in line with its 9.8% annual growth over the past five years. Compare this with the broader industry, which analyst estimates (in aggregate) suggest will see revenues grow 10% annually. It's clear that while Vicor'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 most important thing to take away is that analysts cut their earnings per share estimates, expecting a clear decline in business conditions. Lamentably, they also downgraded their sales forecasts, but the business is still expected to grow at roughly the same rate as the market itself. We wouldn't be surprised to find shareholders feeling a bit shell-shocked, after these downgrades. It looks like analysts have become a lot more bearish on Vicor, and their negativity could be grounds for caution.

Still, the long-term prospects of the business are much more relevant than next year's earnings. At least one analyst has provided forecasts out to 2024, which can be seen 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.