Analysts Have Just Cut Their Hayward Holdings, Inc. (NYSE:HAYW) Revenue Estimates By 14%

The latest analyst coverage could presage a bad day for Hayward Holdings, Inc. (NYSE:HAYW), with the analysts making across-the-board cuts to their statutory estimates that might leave shareholders a little shell-shocked. There was a fairly draconian cut to their revenue estimates, perhaps an implicit admission that previous forecasts were much too optimistic.

Following the latest downgrade, the eleven analysts covering Hayward Holdings provided consensus estimates of US$1.3b revenue in 2022, which would reflect an uneasy 11% decline on its sales over the past 12 months. Prior to the latest estimates, the analysts were forecasting revenues of US$1.6b in 2022. The consensus view seems to have become more pessimistic on Hayward Holdings, noting the substantial drop in revenue estimates in this update.

View our latest analysis for Hayward Holdings

Notably, the analysts have cut their price target 22% to US$15.15, suggesting concerns around Hayward Holdings' valuation. The consensus price target is just an average of individual analyst targets, so - it could be handy to see how wide the range of underlying estimates is. There are some variant perceptions on Hayward Holdings, with the most bullish analyst valuing it at US$23.00 and the most bearish at US$12.00 per share. Note the wide gap in analyst price targets? This implies to us that there is a fairly broad range of possible scenarios for the underlying business.

Taking a look at the bigger picture now, one of the ways we can understand these forecasts is to see how they compare to both past performance and industry growth estimates. We would highlight that sales are expected to reverse, with a forecast 21% annualised revenue decline to the end of 2022. That is a notable change from historical growth of 28% over the last year. By contrast, our data suggests that other companies (with analyst coverage) in the same industry are forecast to see their revenue grow 4.3% annually for the foreseeable future. So although its revenues are forecast to shrink, this cloud does not come with a silver lining - Hayward Holdings is expected to lag the wider industry.

The Bottom Line

The most important thing to take away is that analysts cut their revenue estimates for this year. They also expect company revenue to perform worse than the wider market. The consensus price target fell measurably, with analysts seemingly not reassured by recent business developments, leading to a lower estimate of Hayward Holdings' future valuation. Often, one downgrade can set off a daisy-chain of cuts, especially if an industry is in decline. So we wouldn't be surprised if the market became a lot more cautious on Hayward Holdings after today.

Unsatisfied? At least one of Hayward Holdings' eleven analysts has provided estimates 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.