Growth Investors: Industry Analysts Just Upgraded Their Australian Finance Group Limited (ASX:AFG) Revenue Forecasts By 15%
Australian Finance Group Limited (ASX:AFG) shareholders will have a reason to smile today, with the analysts making substantial upgrades to this year's forecasts. The analysts have sharply increased their revenue numbers, with a view that Australian Finance Group will make substantially more sales than they'd previously expected.
After the upgrade, the three analysts covering Australian Finance Group are now predicting revenues of AU$1.1b in 2024. If met, this would reflect a modest 5.7% improvement in sales compared to the last 12 months. Before the latest update, the analysts were foreseeing AU$920m of revenue in 2024. It looks like there's been a clear increase in optimism around Australian Finance Group, given the nice gain to revenue forecasts.
Check out our latest analysis for Australian Finance Group
Notably, the analysts have cut their price target 6.6% to AU$1.78, suggesting concerns around Australian Finance Group's valuation.
Of course, another way to look at these forecasts is to place them into context against the industry itself. We would highlight that Australian Finance Group's revenue growth is expected to slow, with the forecast 5.7% annualised growth rate until the end of 2024 being well below the historical 12% p.a. growth over the last five years. Compare this with other companies in the same industry, which are forecast to see a revenue decline of 6.8% annually. So it's clear that despite the slowdown in growth, Australian Finance Group is still expected to grow meaningfully faster than 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. Analysts also expect revenues to perform better than the wider market. Furthermore, there was a cut to the price target, suggesting that the latest news has led to more pessimism about the intrinsic value of the business. Seeing the dramatic upgrade to this year's forecasts, it might be time to take another look at Australian Finance Group.
Still got questions? At least one of Australian Finance Group's three analysts has provided estimates out to 2026, 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.
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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.
