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Analysts Just Made A Major Revision To Their Kemper Corporation (NYSE:KMPR) Revenue Forecasts

The analysts covering Kemper Corporation (NYSE:KMPR) delivered a dose of negativity to shareholders today, by making a substantial revision to their statutory forecasts for next year. 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 four analysts covering Kemper, is for revenues of US$4.5b in 2024, which would reflect a not inconsiderable 14% reduction in Kemper's sales over the past 12 months. Losses are expected to turn into profits real soon, with the analysts forecasting US$2.97 in per-share earnings. Prior to this update, the analysts had been forecasting revenues of US$5.0b and earnings per share (EPS) of US$3.11 in 2024. It looks like analyst sentiment has fallen somewhat in this update, with a measurable cut to revenue estimates and a minor downgrade to earnings per share numbers as well.

View our latest analysis for Kemper

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

Analysts made no major changes to their price target of US$60.25, suggesting the downgrades are not expected to have a long-term impact on Kemper's valuation.

Looking at the bigger picture now, one of the ways we can make sense of these forecasts is to see how they measure up against both past performance and industry growth estimates. We would highlight that sales are expected to reverse, with a forecast 11% annualised revenue decline to the end of 2024. That is a notable change from historical growth of 6.8% 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 6.3% annually for the foreseeable future. So although its revenues are forecast to shrink, this cloud does not come with a silver lining - Kemper is expected to lag the wider industry.

The Bottom Line

The biggest issue in the new estimates is that analysts have reduced their earnings per share estimates, suggesting business headwinds lay ahead for Kemper. Unfortunately analysts also downgraded their revenue estimates, and industry data suggests that Kemper's revenues are expected to grow slower 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 Kemper after today.

Not only have the analysts been downgrading the stock, but it looks like Kemper might find it hard to maintain its dividends, if these forecasts prove accurate. What makes us say that? Learn more by visiting our risks dashboard 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.

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

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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