Yahoo Finance Analysts Are More Bearish On Nephros, Inc. (NASDAQ:NEPH) Than They Used To Be
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The latest analyst coverage could presage a bad day for Nephros, Inc. (NASDAQ:NEPH), with the analysts making across-the-board cuts to their statutory estimates that might leave shareholders a little shell-shocked. Both revenue and earnings per share (EPS) estimates were cut sharply as analysts factored in the latest outlook for the business, concluding that they were too optimistic previously.
Following the latest downgrade, the three analysts covering Nephros provided consensus estimates of US$11m revenue in 2020, which would reflect a small 4.4% decline on its sales over the past 12 months. Per-share losses are expected to creep up to US$0.43. Yet prior to the latest estimates, the analysts had been forecasting revenues of US$12m and losses of US$0.39 per share in 2020. Ergo, there's been a clear change in sentiment, with the analysts administering a notable cut to this year's revenue estimates, while at the same time increasing their loss per share forecasts.
View our latest analysis for Nephros
These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Nephros' past performance and to peers in the same industry. We would highlight that sales are expected to reverse, with the forecast 4.4% revenue decline a notable change from historical growth of 39% over the last five years. By contrast, our data suggests that other companies (with analyst coverage) in the same industry are forecast to see their revenue grow 2.7% annually for the foreseeable future. So although its revenues are forecast to shrink, this cloud does not come with a silver lining - Nephros is expected to lag the wider industry.
The Bottom Line
The most important thing to take away is that analysts increased their loss per share estimates for this year. Regrettably, they also downgraded their revenue estimates, and the latest forecasts imply the business will grow sales slower than the wider market. We wouldn't be surprised to find shareholders feeling a bit shell-shocked, after these downgrades. It looks like analysts have become a lot more bearish on Nephros, and their negativity could be grounds for caution.
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 Nephros going out to 2022, 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.
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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