Bearish: This Analyst Is Revising Their Trinity Biotech plc (NASDAQ:TRIB) Revenue and EPS Prognostications
The analyst covering Trinity Biotech plc (NASDAQ:TRIB) delivered a dose of negativity to shareholders today, by making a substantial revision to their statutory forecasts for this year. Both revenue and earnings per share (EPS) estimates were cut sharply as the analyst factored in the latest outlook for the business, concluding that they were too optimistic previously.
Following the downgrade, the consensus from single analyst covering Trinity Biotech is for revenues of US$59m in 2023, implying an uneasy 20% decline in sales compared to the last 12 months. The loss per share is anticipated to greatly reduce in the near future, narrowing 55% to US$0.40. Yet prior to the latest estimates, the analyst had been forecasting revenues of US$72m and losses of US$0.22 per share in 2023. Ergo, there's been a clear change in sentiment, with the analyst administering a notable cut to this year's revenue estimates, while at the same time increasing their loss per share forecasts.
Check out our latest analysis for Trinity Biotech
These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Trinity Biotech's past performance and to peers in the same industry. One more thing stood out to us about these estimates, and it's the idea that Trinity Biotech's decline is expected to accelerate, with revenues forecast to fall at an annualised rate of 25% to the end of 2023. This tops off a historical decline of 3.6% a year 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 revenue grow 7.8% per year. So it's pretty clear that, while it does have declining revenues, the analyst also expect Trinity Biotech to suffer worse than the wider industry.
The Bottom Line
The most important thing to note from this downgrade is that the consensus increased its forecast losses this year, suggesting all may not be well at Trinity Biotech. Unfortunately the analyst also downgraded their revenue estimates, and industry data suggests that Trinity Biotech's revenues are expected to grow slower than the wider market. After a cut like that, investors could be forgiven for thinking the analyst is a lot more bearish on Trinity Biotech, and a few readers might choose to steer clear of the stock.
With that said, the long-term trajectory of the company's earnings is a lot more important than next year. We have analyst estimates for Trinity Biotech going out as far as 2024, and you can see them 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.
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