These Analysts Just Made A Huge Downgrade To Their Thryv Holdings, Inc. (NASDAQ:THRY) EPS Forecasts

The latest analyst coverage could presage a bad day for Thryv Holdings, Inc. (NASDAQ:THRY), with the analysts making across-the-board cuts to their statutory estimates that might leave shareholders a little shell-shocked. Revenue and earnings per share (EPS) forecasts were both revised downwards, with analysts seeing grey clouds on the horizon.

Following the latest downgrade, the five analysts covering Thryv Holdings provided consensus estimates of US$899m revenue in 2023, which would reflect a sizeable 23% decline on its sales over the past 12 months. Statutory earnings per share are anticipated to dive 79% to US$0.67 in the same period. Before this latest update, the analysts had been forecasting revenues of US$1.0b and earnings per share (EPS) of US$2.26 in 2023. Indeed, we can see that the analysts are a lot more bearish about Thryv Holdings' prospects, administering a substantial drop in revenue estimates and slashing their EPS estimates to boot.

View our latest analysis for Thryv Holdings

It'll come as no surprise then, to learn that the analysts have cut their price target 13% to US$36.75. There's another way to think about price targets though, and that's to look at the range of price targets put forward by analysts, because a wide range of estimates could suggest a diverse view on possible outcomes for the business. There are some variant perceptions on Thryv Holdings, with the most bullish analyst valuing it at US$42.00 and the most bearish at US$35.00 per share. This is a very narrow spread of estimates, implying either that Thryv Holdings is an easy company to value, or - more likely - the analysts are relying heavily on some key assumptions.

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 11% annually. Worse, forecasts are essentially predicting the decline to accelerate, with the estimate for an annualised 19% 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 3.4% annually. So it's pretty clear that, while it does have declining revenues, the analysts also expect Thryv Holdings to suffer worse than the wider industry.

The Bottom Line

The most important thing to take away is that analysts cut their earnings per share estimates, expecting a clear decline in business conditions. Unfortunately analysts also downgraded their revenue estimates, and industry data suggests that Thryv Holdings' revenues are expected to grow slower than the wider market. After such a stark change in sentiment from analysts, we'd understand if readers now felt a bit wary of Thryv Holdings.

After a downgrade like this, it's pretty clear that previous forecasts were too optimistic. What's more, we've spotted several possible issues with Thryv Holdings' business, like a weak balance sheet. For more information, you can click here to discover this and the 2 other flags we've identified.

You can also see our analysis of Thryv Holdings' Board and CEO remuneration and experience, and whether company insiders have been buying stock.

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.