RF Industries, Ltd. (NASDAQ:RFIL) Analysts Are Cutting Their Estimates: Here's What You Need To Know
As you might know, RF Industries, Ltd. (NASDAQ:RFIL) recently reported its first-quarter numbers. It was a moderately negative result overall - revenue fell 7.1% short of analyst estimates at US$13m, and statutory losses were in line with analyst expectations, at US$0.13 per share. This is an important time for investors, as they can track a company's performance in its report, look at what expert is forecasting for next year, and see if there has been any change to expectations for the business. So we collected the latest post-earnings statutory consensus estimate to see what could be in store for next year.
See our latest analysis for RF Industries
Taking into account the latest results, RF Industries' lone analyst currently expect revenues in 2024 to be US$68.0m, approximately in line with the last 12 months. Losses are forecast to narrow 7.1% to US$0.29 per share. Yet prior to the latest earnings, the analyst had been forecasting revenues of US$73.8m and losses of US$0.12 per share in 2024. So it's pretty clear the analyst has mixed opinions on RF Industries after this update; revenues were downgraded and per-share losses expected to increase.
The average price target fell 5.9% to US$4.00, implicitly signalling that lower earnings per share are a leading indicator for RF Industries' valuation.
Of course, another way to look at these forecasts is to place them into context against the industry itself. We would highlight that RF Industries' revenue growth is expected to slow, with the forecast 1.5% annualised growth rate until the end of 2024 being well below the historical 12% p.a. growth over the last five years. By way of comparison, the other companies in this industry with analyst coverage are forecast to grow their revenue at 5.4% per year. Factoring in the forecast slowdown in growth, it seems obvious that RF Industries is also expected to grow slower than other industry participants.
The Bottom Line
The most important thing to note is the forecast of increased losses next year, suggesting all may not be well at RF Industries. Unfortunately, they also downgraded their revenue estimates, and our data indicates underperformance compared to the wider industry. Even so, earnings per share are more important to the intrinsic value of the business. Furthermore, the analyst also cut their price targets, suggesting that the latest news has led to greater pessimism about the intrinsic value of the business.
Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. We have analyst estimates for RF Industries going out as far as 2025, and you can see them free on our platform here.
However, before you get too enthused, we've discovered 1 warning sign for RF Industries that you should be aware of.
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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.
