TSE:VIVO) shareholders today, when the covering analyst downgraded their forecasts for this year. Revenue estimates were cut sharply as the analyst signalled a weaker outlook – perhaps a sign that investors should temper their expectations as well.” data-reactid=”19″>Market forces rained on the parade of VIVO Cannabis Inc. (TSE:VIVO) shareholders today, when the covering analyst downgraded their forecasts for this year. Revenue estimates were cut sharply as the analyst signalled a weaker outlook – perhaps a sign that investors should temper their expectations as well.
Following the downgrade, the current consensus from VIVO Cannabis’ solitary analyst is for revenues of CA$40m in 2020 which – if met – would reflect a huge 74% increase on its sales over the past 12 months. Prior to the latest estimates, the analyst was forecasting revenues of CA$52m in 2020. It looks like forecasts have become a fair bit less optimistic on VIVO Cannabis, given the pretty serious reduction to revenue estimates.
See our latest analysis for VIVO Cannabis ” data-reactid=”21″>See our latest analysis for VIVO Cannabis
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. Next year brings more of the same, according to the analyst, with revenue forecast to grow 74%, in line with its 78% annual growth over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to see their revenues grow 36% per year. So although VIVO Cannabis 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 the analyst cut their revenue estimates for this year. They’re also forecasting more rapid revenue growth than the wider market. Overall, given the drastic downgrade to this year’s forecasts, we’d be feeling a little more wary of VIVO Cannabis going forwards.
click here to discover this and the 4 other risks we’ve identified.” data-reactid=”38″>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 VIVO Cannabis’ business, like dilutive stock issuance over the past year. For more information, you can click here to discover this and the 4 other risks we’ve identified.
list of stocks that insiders are buying.” data-reactid=”39″>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.
editorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Thank you for reading.
Recent Comments