One Analyst Just Shaved Their The Glimpse Group, Inc. (NASDAQ:VRAR) Forecasts Dramatically

Today is shaping up negative for The Glimpse Group, Inc. (NASDAQ:VRAR) shareholders, with the covering analyst delivering a substantial negative revision to this year's forecasts. Revenue and earnings per share (EPS) forecasts were both revised downwards, with the analyst seeing grey clouds on the horizon.

After the downgrade, the one analyst covering Glimpse Group is now predicting revenues of US$16m in 2024. If met, this would reflect a substantial 22% improvement in sales compared to the last 12 months. The loss per share is anticipated to greatly reduce in the near future, narrowing 73% to US$0.53. Yet before this consensus update, the analyst had been forecasting revenues of US$23m and losses of US$0.44 per share in 2024. So there's been quite a change-up of views after the recent consensus updates, with the analyst making a serious cut to their revenue forecasts while also expecting losses per share to increase.

See our latest analysis for Glimpse Group

The consensus price target fell 38% to US$5.50, with the analyst clearly concerned about the company following the weaker revenue and earnings outlook.

Another way we can view these estimates is in the context of the bigger picture, such as how the forecasts stack up against past performance, and whether forecasts are more or less bullish relative to other companies in the industry. We would highlight that Glimpse Group's revenue growth is expected to slow, with the forecast 22% annualised growth rate until the end of 2024 being well below the historical 67% p.a. growth over the last three years. By way of comparison, the other companies in this industry with analyst coverage are forecast to grow their revenue at 9.6% annually. So it's pretty clear that, while Glimpse Group's revenue growth is expected to slow, it's still expected to grow faster than the industry itself.

The Bottom Line

The most important thing to note from this downgrade is that the consensus increased its forecast losses this year, suggesting all may not be well at Glimpse Group. While the analyst did downgrade their revenue estimates, these forecasts still imply revenues will perform better than the wider market. After such a stark change in sentiment from the analyst, we'd understand if readers now felt a bit wary of Glimpse Group.

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 Glimpse Group's business, like a short cash runway. Learn more, and discover the 3 other risks we've identified, for free on our platform here.

Another way to search for interesting companies that could be reaching an inflection point is to track whether management are buying or selling, with our free list of growing companies 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.