This Broker Just Slashed Their Trinity Biotech plc (NASDAQ:TRIB) Earnings Forecasts

The latest analyst coverage could presage a bad day for Trinity Biotech plc (NASDAQ:TRIB), with the covering analyst making across-the-board cuts to their statutory estimates that might leave shareholders a little shell-shocked. Both revenue and earnings per share (EPS) estimates were cut sharply as the analyst factored in the latest outlook for the business, concluding that they were too optimistic previously. Bidders are definitely seeing a different story, with the stock price of US$1.12 reflecting a 33% rise in the past week. Whether the downgrade will have a negative impact on demand for shares is yet to be seen.

Following the latest downgrade, the lone analyst covering Trinity Biotech provided consensus estimates of US$72m revenue in 2023, which would reflect a discernible 4.4% decline on its sales over the past 12 months. The loss per share is anticipated to greatly reduce in the near future, narrowing 79% to US$0.22. Yet prior to the latest estimates, the analyst had been forecasting revenues of US$81m and losses of US$0.19 per share in 2023. Ergo, there's been a clear change in sentiment, with the analyst administering a notable cut to this year's revenue estimates, while at the same time increasing their loss per share forecasts.

Check out our latest analysis for Trinity Biotech

Looking at the bigger picture now, one of the ways we can make sense of these forecasts is to see how they measure up against both past performance and industry growth estimates. Over the past five years, revenues have declined around 2.8% annually. Worse, forecasts are essentially predicting the decline to accelerate, with the estimate for an annualised 4.4% decline in revenue until the end of 2023. Compare this against analyst estimates for companies in the broader industry, which suggest that revenues (in aggregate) are expected to grow 8.0% annually. So it's pretty clear that, while it does have declining revenues, the analyst also expect Trinity Biotech to suffer worse 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 this year. Unfortunately the analyst also downgraded their revenue estimates, and industry data suggests that Trinity Biotech's revenues are expected to grow slower than the wider market. After a cut like that, investors could be forgiven for thinking the analyst is a lot more bearish on Trinity Biotech, and a few readers might choose to steer clear of the stock.

With that said, the long-term trajectory of the company's earnings is a lot more important than next year. We have analyst estimates for Trinity Biotech going out as far as 2024, and you can see them 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.