TeraWulf Inc. (NASDAQ:WULF) Analysts Just Cut Their EPS Forecasts Substantially

Market forces rained on the parade of TeraWulf Inc. (NASDAQ:WULF) shareholders today, when the analysts downgraded their forecasts for this year. Both revenue and earnings per share (EPS) estimates were cut sharply as the analysts factored in the latest outlook for the business, concluding that they were too optimistic previously. Investors however, have been notably more optimistic about TeraWulf recently, with the stock price up a notable 23% to US$3.83 in the past week. With such a sharp increase, it seems brokers may have seen something that is not yet being priced in by the wider market.

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After this downgrade, TeraWulf's nine analysts are now forecasting revenues of US$202m in 2025. This would be a huge 53% improvement in sales compared to the last 12 months. Per-share losses are expected to see a sharp uptick, reaching US$0.38. Yet before this consensus update, the analysts had been forecasting revenues of US$226m and losses of US$0.17 per share in 2025. Ergo, there's been a clear change in sentiment, with the analysts administering a notable cut to this year's revenue estimates, while at the same time increasing their loss per share forecasts.

See our latest analysis for TeraWulf

The consensus price target was broadly unchanged at US$6.55, perhaps implicitly signalling that the weaker earnings outlook is not expected to have a long-term impact on the valuation.

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. The period to the end of 2025 brings more of the same, according to the analysts, with revenue forecast to display 77% growth on an annualised basis. That is in line with its 84% annual growth over the past three years. Compare this with the broader industry, which analyst estimates (in aggregate) suggest will see revenues grow 13% annually. So although TeraWulf 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 analysts increased their loss per share estimates for this year. While analysts did downgrade their revenue estimates, these forecasts still imply revenues will perform better than the wider market. The lack of change in the price target is puzzling in light of the downgrade but, with a serious decline expected this year, we wouldn't be surprised if investors were a bit wary of TeraWulf.

That said, the analysts might have good reason to be negative on TeraWulf, given a short cash runway. For more information, you can click here to discover this and the 2 other concerns 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 with high insider ownership.

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