Time To Worry? Analysts Are Downgrading Their Brilliant Earth Group, Inc. (NASDAQ:BRLT) Outlook
Today is shaping up negative for Brilliant Earth Group, Inc. (NASDAQ:BRLT) shareholders, with the analysts delivering a substantial negative revision to next year's forecasts. Revenue and earnings per share (EPS) forecasts were both revised downwards, with the analysts seeing grey clouds on the horizon.
Following the downgrade, the latest consensus from Brilliant Earth Group's eight analysts is for revenues of US$483m in 2024, which would reflect a notable 9.3% improvement in sales compared to the last 12 months. Per-share earnings are expected to shoot up 34% to US$0.12. Previously, the analysts had been modelling revenues of US$552m and earnings per share (EPS) of US$0.20 in 2024. Indeed, we can see that the analysts are a lot more bearish about Brilliant Earth Group's prospects, administering a substantial drop in revenue estimates and slashing their EPS estimates to boot.
View our latest analysis for Brilliant Earth Group
It'll come as no surprise then, to learn that the analysts have cut their price target 29% to US$4.54.
Taking a look at the bigger picture now, one of the ways we can understand these forecasts is to see how they compare to both past performance and industry growth estimates. It's pretty clear that there is an expectation that Brilliant Earth Group's revenue growth will slow down substantially, with revenues to the end of 2024 expected to display 7.3% growth on an annualised basis. This is compared to a historical growth rate of 18% over the past three years. Juxtapose this against the other companies in the industry with analyst coverage, which are forecast to grow their revenues (in aggregate) 5.7% per year. Even after the forecast slowdown in growth, it seems obvious that Brilliant Earth Group is also expected to grow faster than the wider industry.
The Bottom Line
The biggest issue in the new estimates is that analysts have reduced their earnings per share estimates, suggesting business headwinds lay ahead for Brilliant Earth Group. While analysts did downgrade their revenue estimates, these forecasts still imply revenues will perform better than the wider market. Given the scope of the downgrades, it would not be a surprise to see the market become more wary of the business.
Still, the long-term prospects of the business are much more relevant than next year's earnings. At Simply Wall St, we have a full range of analyst estimates for Brilliant Earth Group going out to 2025, and you can see them 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 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.
