Analysts Just Shaved Their NewtekOne, Inc. (NASDAQ:NEWT) Forecasts Dramatically
The analysts covering NewtekOne, Inc. (NASDAQ:NEWT) delivered a dose of negativity to shareholders today, by making a substantial revision to their statutory forecasts for next year. Revenue and earnings per share (EPS) forecasts were both revised downwards, with analysts seeing grey clouds on the horizon.
Following the downgrade, the most recent consensus for NewtekOne from its four analysts is for revenues of US$233m in 2024 which, if met, would be a substantial 24% increase on its sales over the past 12 months. Per-share earnings are expected to leap 81% to US$1.85. Prior to this update, the analysts had been forecasting revenues of US$259m and earnings per share (EPS) of US$2.35 in 2024. It looks like analyst sentiment has declined substantially, with a substantial drop in revenue estimates and a large cut to earnings per share numbers as well.
See our latest analysis for NewtekOne
The consensus price target fell 13% to US$15.63, with the weaker earnings outlook clearly leading analyst valuation estimates.
These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the NewtekOne's past performance and to peers in the same industry. The period to the end of 2024 brings more of the same, according to the analysts, with revenue forecast to display 19% growth on an annualised basis. That is in line with its 22% 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 3.3% per year. So although NewtekOne is expected to maintain its revenue growth rate, it's definitely expected to grow faster than 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 NewtekOne. While analysts did downgrade their revenue estimates, these forecasts still imply revenues will perform better than the wider market. After such a stark change in sentiment from analysts, we'd understand if readers now felt a bit wary of NewtekOne.
As you can see, the analysts clearly aren't bullish, and there might be good reason for that. We've identified some potential issues with NewtekOne's financials, such as the risk of cutting its dividend. Learn more, and discover the 2 other risks we've identified, 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.
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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.
