What You Need To Know About The Nautilus, Inc. (NYSE:NLS) Analyst Downgrade Today

The latest analyst coverage could presage a bad day for Nautilus, Inc. (NYSE:NLS), 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.

After the downgrade, the consensus from Nautilus' four analysts is for revenues of US$273m in 2024, which would reflect a considerable 19% decline in sales compared to the last year of performance. The loss per share is anticipated to greatly reduce in the near future, narrowing 73% to US$0.90. However, before this estimates update, the consensus had been expecting revenues of US$353m and US$0.90 per share in losses. So there's definitely been a change in sentiment in this update, with the analysts administering a substantial haircut to next year's revenue estimates, while at the same time holding losses per share steady.

Check out our latest analysis for Nautilus

Of course, another way to look at these forecasts is to place them into context against the industry itself. These estimates imply that sales are expected to slow, with a forecast annualised revenue decline of 16% by the end of 2024. This indicates a significant reduction from annual growth of 8.4% over the last five years. By contrast, our data suggests that other companies (with analyst coverage) in the same industry are forecast to see their revenue grow 4.0% annually for the foreseeable future. It's pretty clear that Nautilus' revenues are expected to perform substantially worse than the wider industry.

The Bottom Line

Regrettably, they also downgraded their revenue estimates, and the latest forecasts imply the business will grow sales slower than the wider market. Overall, given the drastic downgrade to next year's forecasts, we'd be feeling a little more wary of Nautilus going forwards.

A high debt burden combined with a downgrade of this magnitude always gives us some reason for concern, especially if these forecasts are just the first sign of a business downturn. See why we're concerned about Nautilus' balance sheet by visiting our risks dashboard for free on our platform here.

We also provide an overview of the Nautilus Board and CEO remuneration and length of tenure at the company, and whether insiders have been buying the stock, here.

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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.