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Analysts Just Made A Major Revision To Their Sun Life Financial Inc. (TSE:SLF) Revenue Forecasts

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·2 min read
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The latest analyst coverage could presage a bad day for Sun Life Financial Inc. (TSE:SLF), 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 this downgrade, Sun Life Financial's ten analysts are forecasting 2022 revenues to be CA$34b, approximately in line with the last 12 months. Statutory earnings per share are supposed to sink 11% to CA$5.82 in the same period. Previously, the analysts had been modelling revenues of CA$40b and earnings per share (EPS) of CA$5.85 in 2022. So there's been a clear change in analyst sentiment in the recent update, with the analysts making a substantial drop in revenues and reconfirming their earnings per share estimates.

See our latest analysis for Sun Life Financial

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

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Sun Life Financial's past performance and to peers in the same industry. These estimates imply that sales are expected to slow, with a forecast annualised revenue decline of 1.4% by the end of 2022. This indicates a significant reduction from annual growth of 8.5% over the last five years. Compare this with our data, which suggests that other companies in the same industry are, in aggregate, expected to see their revenue grow 15% per year. So although its revenues are forecast to shrink, this cloud does not come with a silver lining - Sun Life Financial is expected to lag the wider industry.

The Bottom Line

The most obvious conclusion from this consensus update is that there's been no major change in the business' prospects in recent times, with analysts holding earnings per share steady, in line with previous estimates. Unfortunately analysts also downgraded their revenue estimates, and industry data suggests that Sun Life Financial's revenues are expected to grow slower than the wider market. Given the stark change in sentiment, we'd understand if investors became more cautious on Sun Life Financial after today.

Even so, the longer term trajectory of the business is much more important for the value creation of shareholders. At Simply Wall St, we have a full range of analyst estimates for Sun Life Financial going out to 2024, and you can see them 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.

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.