FEV) performing well in the short term

Latest analyst coverage could portend a bad day for FORTEC Elektronik AG (ETR:FEV) as the covering analyst made across-the-board cuts to its statutory estimates, which could leave shareholders a little shocked. Revenue and earnings per share (EPS) forecasts were revised downward, suggesting the analyst has taken a significant downgrade on the business.

After the deterioration, the consensus of FORTEC Elektronik's sole analyst expects a turnover of €93 million in 2024, which would reflect a significant drop in sales of 10% compared to the last year of performance. Statutory earnings per share are expected to fall by 27% to €1.66 over the same period. Previously, the analyst had modeled revenue of 106 million euros and earnings per share (EPS) of 2.10 euros in 2024. Indeed, we can see that the analyst is much more pessimistic about the FORTEC Elektronik's outlook, administering a measurable reduction in revenue estimates and significantly reducing their EPS estimates to boot.

Check out our latest analysis for FORTEC Elektronik

It will therefore not be surprising to learn that the analyst has lowered his price target by 6.1% to €31.00.

These estimates are interesting, but it can be helpful to give some more general guidance to see how the forecasts compare, both to FORTEC Elektronik's past performance and to its peers in the same industry. We highlight that sales are expected to reverse, with an expected annualized revenue decline of 10% through the end of 2024. This is a notable change from historical growth of 4.0% during of the last five years. In contrast, our data suggests that other companies (covered by analysts) in the same industry are expected to see revenue grow 11% annually for the foreseeable future. It's clear that FORTEC Elektronik's earnings are expected to be much worse than the broader industry.

The essential

The biggest problem in the new estimates is that the analyst cut his earnings per share estimates, suggesting headwinds lie ahead for FORTEC Elektronik. Unfortunately, they also downgraded their revenue estimates, and the latest forecast implies that the company will experience slower sales growth than the market as a whole. With a significant drop in expectations for this year and a falling price target, we wouldn't be surprised if investors become wary of FORTEC Elektronik.

However, the company's long-term prospects are much more important than next year's profits. We have analyst estimates for FORTEC Elektronik going out to 2026, and you can view them for free on our platform here.

Of course, see the company management invest large sums of money in a stock can be just as useful as knowing whether analysts are revising their estimates downward. You may also want to search this free list of stocks with high insider ownership.

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This Simply Wall St article is general in nature. We provide commentary based on historical data and analyst forecasts only using unbiased methodology and our articles are not intended to constitute financial advice. It does not constitute a recommendation to buy or sell shares and does not take into account your objectives or your financial situation. Our goal is to provide you with targeted, long-term analysis based on fundamental data. Note that our analysis may not take into account the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.