These Analysts Think Finance Of America Companies Inc.'s (NYSE:FOA) Sales Are Under Threat

Today is shaping up negative for Finance Of America Companies Inc. (NYSE:FOA) shareholders, with the analysts delivering a substantial negative revision to this year's forecasts. Revenue estimates were cut sharply as analysts signalled a weaker outlook - perhaps a sign that investors should temper their expectations as well.

Following the latest downgrade, the current consensus, from the three analysts covering Finance Of America Companies, is for revenues of US$334m in 2023, which would reflect a concerning 42% reduction in Finance Of America Companies' sales over the past 12 months. Before the latest update, the analysts were foreseeing US$416m of revenue in 2023. It looks like forecasts have become a fair bit less optimistic on Finance Of America Companies, given the substantial drop in revenue estimates.

Check out our latest analysis for Finance Of America Companies

Of course, another way to look at these forecasts is to place them into context against the industry itself. Over the past three years, revenues have declined around 35% annually. Worse, forecasts are essentially predicting the decline to accelerate, with the estimate for an annualised 66% decline in revenue until the end of 2023. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to see their revenue grow 5.6% per year. So it's pretty clear that, while it does have declining revenues, the analysts also expect Finance Of America Companies to suffer worse than 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. Given the stark change in sentiment, we'd understand if investors became more cautious on Finance Of America Companies after today.

There might be good reason for analyst bearishness towards Finance Of America Companies, like dilutive stock issuance over the past year. Learn more, and discover the 2 other flags 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.