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Analysts Have Made A Financial Statement On TESSCO Technologies Incorporated's (NASDAQ:TESS) Annual Report

Simply Wall St

There's been a notable change in appetite for TESSCO Technologies Incorporated (NASDAQ:TESS) shares in the week since its full-year report, with the stock down 20% to US$4.75. It was a pretty bad result overall; while revenues were in line with expectations at US$540m, statutory losses exploded to US$2.53 per share. The analyst typically update their forecasts at each earnings report, and we can judge from their estimates whether their view of the company has changed or if there are any new concerns to be aware of. We thought readers would find it interesting to see the analyst latest (statutory) post-earnings forecasts for next year.

View our latest analysis for TESSCO Technologies

NasdaqGS:TESS Past and Future Earnings May 14th 2020
NasdaqGS:TESS Past and Future Earnings May 14th 2020

Taking into account the latest results, the current consensus, from the one analyst covering TESSCO Technologies, is for revenues of US$411.5m in 2021, which would reflect a stressful 24% reduction in TESSCO Technologies' sales over the past 12 months. Losses are predicted to fall substantially, shrinking 99% to US$0.02. Before this latest report, the consensus had been expecting revenues of US$411.5m and US$0.02 per share in losses.

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 the forecast 24% revenue decline a notable change from historical growth of 2.3% 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 4.2% annually for the foreseeable future. So although its revenues are forecast to shrink, this cloud does not come with a silver lining - TESSCO Technologies is expected to lag the wider industry.

The Bottom Line

The most obvious conclusion is that the analyst made no changes to their forecasts for a loss next year. On the plus side, there were no major changes to revenue estimates; although forecasts imply revenues will perform worse than the wider industry. We don't have a current price target as part of this update, but the market responded negatively to the update with the share price falling -20% over the past week.

With that said, the long-term trajectory of the company's earnings is a lot more important than next year. At least one analyst has provided forecasts out to 2022, which can be seen for free on our platform here.

And what about risks? Every company has them, and we've spotted 2 warning signs for TESSCO Technologies you should know about.

If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.com. 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. Simply Wall St has no position in the stocks mentioned.

We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Thank you for reading.