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Some Analysts Just Cut Their The PRS REIT plc (LON:PRSR) Estimates

Simply Wall St
·2 mins read

The latest analyst coverage could presage a bad day for The PRS REIT plc (LON:PRSR), with the analysts making across-the-board cuts to their statutory estimates that might leave shareholders a little shell-shocked. This report focused on revenue estimates, and it looks as though the consensus view of the business has become substantially more conservative.

Following the downgrade, the most recent consensus for PRS REIT from its three analysts is for revenues of UK£24m in 2021 which, if met, would be a substantial 88% increase on its sales over the past 12 months. Before the latest update, the analysts were foreseeing UK£28m of revenue in 2021. The consensus view seems to have become more pessimistic on PRS REIT, noting the measurable cut to revenue estimates in this update.

View our latest analysis for PRS REIT

earnings-and-revenue-growth
earnings-and-revenue-growth

One way to get more context on these forecasts is to look at how they compare to both past performance, and how other companies in the same industry are performing. It's pretty clear that there is an expectation that PRS REIT's revenue growth will slow down substantially, with revenues next year expected to grow 88%, compared to a historical growth rate of 116% over the past year. Juxtapose this against the other companies in the industry with analyst coverage, which are forecast to grow their revenues (in aggregate) 6.0% next year. Even after the forecast slowdown in growth, it seems obvious that PRS REIT is also expected to grow faster than the wider industry.

The Bottom Line

The clear low-light was that analysts slashing their revenue forecasts for PRS REIT 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 PRS REIT going forwards.

Want more information? At least one of PRS REIT's three analysts has provided estimates out to 2024, which can be seen for 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.

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. 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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com.