Yahoo Finance The Consensus EPS Estimates For Sarine Technologies Ltd. (SGX:U77) Just Fell A Lot
The analyst covering Sarine Technologies Ltd. (SGX:U77) delivered a dose of negativity to shareholders today, by making a substantial revision to their statutory forecasts for this year. Revenue and earnings per share (EPS) forecasts were both revised downwards, with the analyst seeing grey clouds on the horizon.
Following the downgrade, the consensus from lone analyst covering Sarine Technologies is for revenues of US$42m in 2023, implying a not inconsiderable 18% decline in sales compared to the last 12 months. Statutory earnings per share are anticipated to tumble 92% to US$0.00075 in the same period. Prior to this update, the analyst had been forecasting revenues of US$49m and earnings per share (EPS) of US$0.0065 in 2023. It looks like analyst sentiment has declined substantially, with a substantial drop in revenue estimates and a large cut to earnings per share numbers as well.
See our latest analysis for Sarine Technologies
The consensus price target fell 15% to US$0.19, with the weaker earnings outlook clearly leading analyst valuation estimates.
Of course, another way to look at these forecasts is to place them into context against the industry itself. We would highlight that sales are expected to reverse, with a forecast 18% annualised revenue decline to the end of 2023. That is a notable change from historical growth of 1.1% 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 14% annually for the foreseeable future. So although its revenues are forecast to shrink, this cloud does not come with a silver lining - Sarine Technologies is expected to lag the wider industry.
The Bottom Line
The biggest issue in the new estimates is that the analyst has reduced their earnings per share estimates, suggesting business headwinds lay ahead for Sarine Technologies. Regrettably, they also downgraded their revenue estimates, and the latest forecasts imply the business will grow sales slower than the wider market. Given the scope of the downgrades, it would not be a surprise to see the market become more wary of the business.
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 Sarine Technologies' business, like its declining profit margins. Learn more, and discover the 2 other warning signs 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.
