Yahoo Finance One Guanajuato Silver Company Ltd. (CVE:GSVR) Analyst Just Slashed Their 2024 Revenue Estimates
The latest analyst coverage could presage a bad day for Guanajuato Silver Company Ltd. (CVE:GSVR), with the covering analyst making across-the-board cuts to their statutory estimates that might leave shareholders a little shell-shocked. There was a fairly draconian cut to their revenue estimates, perhaps an implicit admission that previous forecasts were much too optimistic. Investors however, have been notably more optimistic about Guanajuato Silver recently, with the stock price up a remarkable 21% to CA$0.34 in the past week. Whether the downgrade will have a negative impact on demand for shares is yet to be seen.
Following the downgrade, the latest consensus from Guanajuato Silver's solitary analyst is for revenues of US$70m in 2024, which would reflect a solid 8.1% improvement in sales compared to the last 12 months. Before the latest update, the analyst was foreseeing US$118m of revenue in 2024. The consensus view seems to have become more pessimistic on Guanajuato Silver, noting the pretty serious reduction to revenue estimates in this update.
View our latest analysis for Guanajuato Silver
We'd point out that there was no major changes to their price target of CA$0.83, suggesting the latest estimates were not enough to shift their view on the value of the business.
Of course, another way to look at these forecasts is to place them into context against the industry itself. We would highlight that Guanajuato Silver's revenue growth is expected to slow, with the forecast 6.5% annualised growth rate until the end of 2024 being well below the historical 87% p.a. growth over the last five years. Compare this against other companies (with analyst forecasts) in the industry, which are in aggregate expected to see revenue growth of 13% annually. Factoring in the forecast slowdown in growth, it seems obvious that Guanajuato Silver is also expected to grow slower than other industry participants.
The Bottom Line
The most important thing to take away is that the analyst cut their revenue estimates for next year. They also expect company revenue to perform worse than the wider market. Given the stark change in sentiment, we'd understand if investors became more cautious on Guanajuato Silver after today.
That said, the analyst might have good reason to be negative on Guanajuato Silver, given dilutive stock issuance over the past year. Learn more, and discover the 3 other risks 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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