Bearish: Analysts Just Cut Their Mack-Cali Realty Corporation (NYSE:CLI) Revenue and EPS estimates
Market forces rained on the parade of Mack-Cali Realty Corporation (NYSE:CLI) shareholders today, when the analysts downgraded their forecasts for this year. There was a fairly draconian cut to their revenue estimates, perhaps an implicit admission that previous forecasts were much too optimistic.
Following the downgrade, the current consensus from Mack-Cali Realty's three analysts is for revenues of US$412m in 2020 which - if met - would reflect a decent 18% increase on its sales over the past 12 months. Before the latest update, the analysts were foreseeing US$464m of revenue in 2020. The consensus view seems to have become more pessimistic on Mack-Cali Realty, noting the substantial drop in revenue estimates in this update.
View our latest analysis for Mack-Cali Realty
There was no particular change to the consensus price target of US$19.39, with Mack-Cali Realty's latest outlook seemingly not enough to result in a change of valuation. There's another way to think about price targets though, and that's to look at the range of price targets put forward by analysts, because a wide range of estimates could suggest a diverse view on possible outcomes for the business. There are some variant perceptions on Mack-Cali Realty, with the most bullish analyst valuing it at US$30.00 and the most bearish at US$14.00 per share. Note the wide gap in analyst price targets? This implies to us that there is a fairly broad range of possible scenarios for the underlying business.
One way to get more context on these forecasts is to look at how they compare to both past performance, and how other companies in the same industry are performing. For example, we noticed that Mack-Cali Realty's rate of growth is expected to accelerate meaningfully, with revenues forecast to grow 18%, well above its historical decline of 6.4% a year over the past five years. Compare this against analyst estimates for the wider industry, which suggest that (in aggregate) industry revenues are expected to grow 4.6% next year. So it looks like Mack-Cali Realty is expected to grow faster than its competitors, at least for a while.
The Bottom Line
The most important thing to take away is that analysts cut their revenue estimates for this year. They're also forecasting more rapid revenue growth than the wider market. The lack of change in the price target is puzzling in light of the downgrade but, with a serious decline expected this year, we wouldn't be surprised if investors were a bit wary of Mack-Cali Realty.
Still got questions? We have estimates for Mack-Cali Realty from its three analysts out until 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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