Brokers Are Upgrading Their Views On Guild Holdings Company (NYSE:GHLD) With These New Forecasts

Guild Holdings Company (NYSE:GHLD) shareholders will have a reason to smile today, with the analysts making substantial upgrades to this year's statutory forecasts. The analysts greatly increased their revenue estimates, suggesting a stark improvement in business fundamentals.

Following the latest upgrade, the current consensus, from the six analysts covering Guild Holdings, is for revenues of US$748m in 2023, which would reflect a noticeable 5.3% reduction in Guild Holdings' sales over the past 12 months. Statutory earnings per share are supposed to tumble 73% to US$0.28 in the same period. However, before this estimates update, the consensus had been expecting revenues of US$663m and US$0.25 per share in losses. It looks like there's been a definite improvement in business conditions, with a revenue upgrade supposed to lead to profitability sooner than previously forecast.

View our latest analysis for Guild Holdings

Despite these upgrades, the analysts have not made any major changes to their price target of US$14.07, suggesting that the higher estimates are not likely to have a long term impact on what the stock is worth.

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Guild Holdings' past performance and to peers in the same industry. We would also point out that the forecast 10% annualised revenue decline to the end of 2023 is better than the historical trend, which saw revenues shrink 15% annually over the past three years By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to see their revenue grow 5.5% per year. So it's pretty clear that, while it does have declining revenues, the analysts also expect Guild Holdings to suffer worse than the wider industry.

The Bottom Line

The most important thing to take away from this upgrade is that there is now an expectation for Guild Holdings to become profitable this year, compared to previous expectations of a loss. Fortunately, they also upgraded their revenue estimates, and are forecasting revenues to grow slower than the wider market. Some investors might be disappointed to see that the price target is unchanged, but we feel that improving fundamentals are usually a positive - assuming these forecasts are met! So Guild Holdings could be a good candidate for more research.

Analysts are clearly in love with Guild Holdings at the moment, but before diving in - you should be aware that we've identified some warning flags with the business, such as its declining profit margins. For more information, you can click through to our platform to learn more about this and the 1 other risk we've identified .

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 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.