Golden Ocean Group Limited (NASDAQ:GOGL) shareholders will have a reason to smile today, with the analysts making substantial upgrades to this year's forecasts. The consensus estimated revenue numbers rose, with their view now clearly much more bullish on the company's business prospects. Golden Ocean Group has also found favour with investors, with the stock up a remarkable 12% to US$6.48 over the past week. It will be interesting to see if today's upgrade is enough to propel the stock even higher.
Following the upgrade, the consensus from four analysts covering Golden Ocean Group is for revenues of US$538m in 2021, implying a considerable 12% decline in sales compared to the last 12 months. Prior to the latest estimates, the analysts were forecasting revenues of US$472m in 2021. It looks like there's been a clear increase in optimism around Golden Ocean Group, given the nice increase in revenue forecasts.
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. These estimates imply that sales are expected to slow, with a forecast revenue decline of 12%, a significant reduction from annual growth of 24% over the last five years. Compare this with our data, which suggests that other companies in the same industry are, in aggregate, expected to see their revenue grow 3.6% next year. It's pretty clear that Golden Ocean Group's revenues are expected to perform substantially worse 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. They're also anticipating slower revenue growth than the wider market. Seeing the dramatic upgrade to this year's forecasts, it might be time to take another look at Golden Ocean Group.
That's a pretty serious upgrade, but shareholders might be even more pleased to know that forecasts expect Golden Ocean Group to be able to reach break-even within the next few years. You can learn more about these forecasts, 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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