Analysts Have Been Trimming Their Edible Garden AG Incorporated (NASDAQ:EDBL) Price Target After Its Latest Report

There's been a major selloff in Edible Garden AG Incorporated (NASDAQ:EDBL) shares in the week since it released its yearly report, with the stock down 32% to US$2.21. The results overall were pretty much dead in line with analyst forecasts; revenues were US$12m and statutory losses were US$48.68 per share. Earnings are an important time for investors, as they can track a company's performance, look at what the analyst is forecasting for next year, and see if there's been a change in sentiment towards the company. With this in mind, we've gathered the latest statutory forecasts to see what the analyst is expecting for next year.

See our latest analysis for Edible Garden

Taking into account the latest results, the most recent consensus for Edible Garden from single analyst is for revenues of US$13.1m in 2023 which, if met, would be a solid 14% increase on its sales over the past 12 months. The loss per share is expected to greatly reduce in the near future, narrowing 40% to US$3.74. Yet prior to the latest earnings, the analyst had been forecasting revenues of US$13.2m and losses of US$3.34 per share in 2023. So it's pretty clear the analyst has mixed opinions on Edible Garden even after this update; although they reconfirmed their revenue numbers, it came at the cost of a considerable increase in per-share losses.

The consensus price target fell 42% to US$7.00per share, with the analyst clearly concerned by ballooning losses.

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Edible Garden's past performance and to peers in the same industry. We can infer from the latest estimates that forecasts expect a continuation of Edible Garden'shistorical trends, as the 14% annualised revenue growth to the end of 2023 is roughly in line with the 17% annual revenue growth over the past three years. Compare this with the broader industry, which analyst estimates (in aggregate) suggest will see revenues grow 2.8% annually. So although Edible Garden is expected to maintain its revenue growth rate, it's definitely expected to grow faster than the wider industry.

The Bottom Line

The most important thing to take away is that the analyst increased their loss per share estimates for next year. Fortunately, they also reconfirmed their revenue numbers, suggesting sales are tracking in line with expectations - and our data suggests that revenues are expected to grow faster than the wider industry. Furthermore, the analyst also cut their price targets, suggesting that the latest news has led to greater pessimism about the intrinsic value of the business.

Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. At least one analyst has provided forecasts out to 2024, which can be seen for free on our platform here.

However, before you get too enthused, we've discovered 5 warning signs for Edible Garden (4 don't sit too well with us!) that you should be aware of.

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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.