News Flash: 5 Analysts Think Kulicke and Soffa Industries, Inc. (NASDAQ:KLIC) Earnings Are Under Threat

Today is shaping up negative for Kulicke and Soffa Industries, Inc. (NASDAQ:KLIC) shareholders, with the analysts delivering a substantial negative revision to next year's forecasts. Both revenue and earnings per share (EPS) forecasts went under the knife, suggesting the analysts have soured majorly on the business.

Following the latest downgrade, the five analysts covering Kulicke and Soffa Industries provided consensus estimates of US$1.1b revenue in 2023, which would reflect a painful 34% decline on its sales over the past 12 months. Statutory earnings per share are supposed to tumble 58% to US$3.67 in the same period. Previously, the analysts had been modelling revenues of US$1.4b and earnings per share (EPS) of US$5.28 in 2023. It looks like analyst sentiment has declined substantially, with a sizeable cut to revenue estimates and a large cut to earnings per share numbers as well.

View our latest analysis for Kulicke and Soffa Industries

It'll come as no surprise then, to learn that the analysts have cut their price target 18% to US$58.75. The consensus price target is just an average of individual analyst targets, so - it could be handy to see how wide the range of underlying estimates is. Currently, the most bullish analyst values Kulicke and Soffa Industries at US$70.00 per share, while the most bearish prices it at US$50.00. Analysts definitely have varying views on the business, but the spread of estimates is not wide enough in our view to suggest that extreme outcomes could await Kulicke and Soffa Industries shareholders.

One way to get more context on these forecasts is to look at how they compare to both past performance, and how other companies in the same industry are performing. These estimates imply that sales are expected to slow, with a forecast annualised revenue decline of 29% by the end of 2023. This indicates a significant reduction from annual growth of 17% over the last five years. By contrast, our data suggests that other companies (with analyst coverage) in the same industry are forecast to see their revenue grow 8.8% annually for the foreseeable future. So although its revenues are forecast to shrink, this cloud does not come with a silver lining - Kulicke and Soffa Industries is expected to lag 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 Kulicke and Soffa Industries. Regrettably, they also downgraded their revenue estimates, and the latest forecasts imply the business will grow sales 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 Kulicke and Soffa Industries.

There might be good reason for analyst bearishness towards Kulicke and Soffa Industries, like recent substantial insider selling. For more information, you can click here to discover this and the 1 other warning sign we've identified.

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.