On the Beach Group plc (LON:OTB) shareholders will have a reason to smile today, with the analysts making substantial upgrades to this year's forecasts. The revenue forecast for this year has experienced a facelift, with analysts now much more optimistic on its sales pipeline.
Following the latest upgrade, the seven analysts covering On the Beach Group provided consensus estimates of UK£62m revenue in 2020, which would reflect a sizeable 37% decline on its sales over the past 12 months. Prior to the latest estimates, the analysts were forecasting revenues of UK£47m in 2020. It looks like there's been a clear increase in optimism around On the Beach Group, given the chunky increase in revenue forecasts.
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. These estimates imply that sales are expected to slow, with a forecast revenue decline of 37%, a significant reduction from annual growth of 16% 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 14% annually for the foreseeable future. So although its revenues are forecast to shrink, this cloud does not come with a silver lining - On the Beach Group is expected to lag the wider industry.
The Bottom Line
The most important thing to take away from this upgrade is that analysts lifted their revenue estimates for this year. They also expect company revenue to perform worse than the wider market. The clear improvement in sentiment should be enough to get most shareholders feeling more optimistic about On the Beach Group's future.
Need some more information? At least one of On the Beach Group's seven analysts has provided estimates out to 2024, which can be seen 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 upgrading their estimates. So you may also wish to search this free list of stocks that insiders are buying.
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. 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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