One Analyst Thinks Globus Maritime Limited's (NASDAQ:GLBS) Revenues Are Under Threat
Market forces rained on the parade of Globus Maritime Limited (NASDAQ:GLBS) shareholders today, when the covering analyst downgraded their forecasts for this year. Revenue estimates were cut sharply as the analyst signalled a weaker outlook - perhaps a sign that investors should temper their expectations as well.
Following the latest downgrade, the solitary analyst covering Globus Maritime provided consensus estimates of US$28m revenue in 2023, which would reflect a substantial 46% decline on its sales over the past 12 months. Following this this downgrade, earnings are now expected to tip over into loss-making territory, with the analyst forecasting losses of US$0.07 per share in 2023. Before this latest update, the analyst had been forecasting revenues of US$39m and earnings per share (EPS) of US$0.17 in 2023. So we can see that the consensus has become notably more bearish on Globus Maritime's outlook with these numbers, making a sizeable cut to this year's revenue estimates. Furthermore, they expect the business to be loss-making this year, compared to their previous forecasts of a profit.
See our latest analysis for Globus Maritime
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. We would highlight that sales are expected to reverse, with a forecast 56% annualised revenue decline to the end of 2023. That is a notable change from historical growth of 36% over the last five years. By contrast, our data suggests that other companies (with analyst coverage) in the industry are forecast to see their revenue decline 1.7% annually for the foreseeable future. So it's pretty clear that Globus Maritime's revenues are expected to shrink faster than the wider industry.
The Bottom Line
The biggest low-light for us was that the forecasts for Globus Maritime dropped from profits to a loss this year. Unfortunately they also downgraded their revenue estimates, and our aggregation of analyst estimates suggests that Globus Maritime revenue is expected to perform worse than the wider market. Often, one downgrade can set off a daisy-chain of cuts, especially if an industry is in decline. So we wouldn't be surprised if the market became a lot more cautious on Globus Maritime after today.
That said, this analyst might have good reason to be negative on Globus Maritime, given concerns around earnings quality. For more information, you can click here to discover this and the 2 other warning signs we've identified.
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.
