Yahoo Finance One Forecaster Is Now More Bearish On Kaspien Holdings Inc. (NASDAQ:KSPN) Than They Used To Be
The analyst covering Kaspien Holdings Inc. (NASDAQ:KSPN) delivered a dose of negativity to shareholders today, by making a substantial revision to their statutory forecasts for next year. Both revenue and earnings per share (EPS) estimates were cut sharply as the analyst factored in the latest outlook for the business, concluding that they were too optimistic previously.
Following the latest downgrade, Kaspien Holdings' single analyst currently expects revenues in 2023 to be US$153m, approximately in line with the last 12 months. The loss per share is anticipated to greatly reduce in the near future, narrowing 38% to US$0.44. Previously, the analyst had been modelling revenues of US$174m and earnings per share (EPS) of US$0.32 in 2023. There looks to have been a major change in sentiment regarding Kaspien Holdings' prospects, with a measurable cut to revenues and the analyst now forecasting a loss instead of a profit.
View our latest analysis for Kaspien Holdings
The consensus price target fell 33% to US$40.00, implicitly signalling that lower earnings per share are a leading indicator for Kaspien Holdings' valuation.
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 also point out that the forecast 0.04% annualised revenue decline to the end of 2023 is better than the historical trend, which saw revenues shrink 23% annually over the past five years By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to see their revenue grow 15% per year. So while a broad number of companies are forecast to grow, unfortunately Kaspien Holdings is expected to see its sales affected worse than other companies in the industry.
The Bottom Line
The most important thing to take away is that the analyst is expecting Kaspien Holdings to become unprofitable next year. Unfortunately the analyst also downgraded their revenue estimates, and industry data suggests that Kaspien Holdings' revenues are expected to grow slower than the wider market. With a serious cut to next year's expectations and a falling price target, we wouldn't be surprised if investors were becoming wary of Kaspien Holdings.
So things certainly aren't looking great, and you should also know that we've spotted some potential warning signs with Kaspien Holdings, including a short cash runway. Learn more, and discover the 3 other flags we've identified, for 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.
