Yahoo Finance One elumeo SE (ETR:ELB) Analyst Has Been Cutting Their Forecasts
Market forces rained on the parade of elumeo SE (ETR:ELB) shareholders today, when the covering analyst downgraded their forecasts for this year. Both revenue and earnings per share (EPS) estimates were cut sharply as the analyst factored in the latest outlook for the business, concluding that they were too optimistic previously.
Following the latest downgrade, elumeo's solo analyst currently expects revenues in 2023 to be €46m, approximately in line with the last 12 months. The loss per share is anticipated to greatly reduce in the near future, narrowing 83% to €0.11. Prior to this update, the analyst had been forecasting revenues of €53m and earnings per share (EPS) of €0.22 in 2023. So we can see that the consensus has become notably more bearish on elumeo's outlook with these numbers, making a measurable cut to this year's revenue estimates. Furthermore, they expect the business to be loss-making this year, compared to their previous forecasts of a profit.
View our latest analysis for elumeo
The consensus price target fell 16% to €9.00, implicitly signalling that lower earnings per share are a leading indicator for elumeo's valuation.
These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the elumeo's past performance and to peers in the same industry. From these estimates it looks as though the analyst expects the years of declining sales to come to an end, given the flat revenue forecast out to 2023. That would be a definite improvement, given that the past five years have seen sales shrink 6.0% annually. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to see their revenue grow 5.8% per year. Although elumeo's revenues are expected to improve, it seems that it is still expected to grow slower than the wider industry.
The Bottom Line
The most important thing to take away is that the analyst is expecting elumeo to become unprofitable this year. 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 the analyst, we'd understand if readers now felt a bit wary of elumeo.
Still, the long-term prospects of the business are much more relevant than next year's earnings. At least one analyst has provided forecasts out to 2025, which can be seen 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.
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