Analysts Just Slashed Their Navigator Holdings Ltd. (NYSE:NVGS) EPS Numbers

The analysts covering Navigator Holdings Ltd. (NYSE:NVGS) delivered a dose of negativity to shareholders today, by making a substantial revision to their statutory forecasts for next year. Both revenue and earnings per share (EPS) forecasts went under the knife, suggesting analysts have soured majorly on the business.

Following the latest downgrade, the current consensus, from the four analysts covering Navigator Holdings, is for revenues of US$413m in 2023, which would reflect a considerable 15% reduction in Navigator Holdings' sales over the past 12 months. Per-share earnings are expected to shoot up 2,531% to US$0.94. Previously, the analysts had been modelling revenues of US$464m and earnings per share (EPS) of US$1.19 in 2023. It looks like analyst sentiment has declined substantially, with a measurable cut to revenue estimates and a large cut to earnings per share numbers as well.

Check out the opportunities and risks within the US Oil and Gas industry.

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 12% by the end of 2023. This indicates a significant reduction from annual growth of 9.3% over the last five years. By contrast, our data suggests that other companies (with analyst coverage) in the industry are forecast to see their revenue decline 6.8% annually for the foreseeable future. So it's pretty clear that Navigator Holdings' revenues are expected to shrink faster than the wider industry.

The Bottom Line

The biggest issue in the new estimates is that analysts have reduced their earnings per share estimates, suggesting business headwinds lay ahead for Navigator Holdings. Unfortunately they also cut their revenue estimates for next year, and they expect sales to lag the wider market. That said, earnings per share are more important for creating value for shareholders. After a cut like that, investors could be forgiven for thinking analysts are a lot more bearish on Navigator Holdings, and a few readers might choose to steer clear of the stock.

There might be good reason for analyst bearishness towards Navigator Holdings, like its declining profit margins. Learn more, and discover the 2 other risks 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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

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.