Analysts Have Just Cut Their ContextLogic Inc. (NASDAQ:WISH) Revenue Estimates By 11%
Today is shaping up negative for ContextLogic Inc. (NASDAQ:WISH) shareholders, with the analysts delivering a substantial negative revision to this year's forecasts. Revenue estimates were cut sharply as the analysts signalled a weaker outlook - perhaps a sign that investors should temper their expectations as well.
Following the latest downgrade, the current consensus, from the five analysts covering ContextLogic, is for revenues of US$362m in 2023, which would reflect a considerable 14% reduction in ContextLogic's sales over the past 12 months. Prior to the latest estimates, the analysts were forecasting revenues of US$405m in 2023. It looks like forecasts have become a fair bit less optimistic on ContextLogic, given the substantial drop in revenue estimates.
Check out our latest analysis for ContextLogic
Of course, another way to look at these forecasts is to place them into context against the industry itself. We would also point out that the forecast 26% annualised revenue decline to the end of 2023 is better than the historical trend, which saw revenues shrink 60% annually over the past three years Compare this against analyst estimates for companies in the broader industry, which suggest that revenues (in aggregate) are expected to grow 11% annually. So it's pretty clear that, while it does have declining revenues, the analysts also expect ContextLogic to suffer worse than the wider industry.
The Bottom Line
The most important thing to take away is that analysts cut their revenue estimates for this year. They also expect company revenue to perform worse than the wider market. Often, one downgrade can set off a daisy-chain of cuts, especially if an industry is in decline. So we wouldn't be surprised if the market became a lot more cautious on ContextLogic after today.
But wait - there's more! We have estimates for ContextLogic from its five analysts out until 2025, and you can see them free on our platform here.
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.
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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.
