Today is shaping up negative for BRC Inc. (NYSE:BRCC) shareholders, with the analysts delivering a substantial negative revision to this year's forecasts. Revenue estimates were cut sharply as analysts signalled a weaker outlook - perhaps a sign that investors should temper their expectations as well.
Following this downgrade, BRC's eight analysts are forecasting 2024 revenues to be US$401m, approximately in line with the last 12 months. The losses are expected to disappear over the next year or so, with forecasts for a profit of US$0.022 per share this year. Before this latest update, the analysts had been forecasting revenues of US$447m and earnings per share (EPS) of US$0.055 in 2024. Indeed, we can see that the analysts are a lot more bearish about BRC's prospects, administering a measurable cut to revenue estimates and slashing their EPS estimates to boot.
It'll come as no surprise then, to learn that the analysts have cut their price target 20% to US$5.98.
Of course, another way to look at these forecasts is to place them into context against the industry itself. These estimates imply that sales are expected to slow, with a forecast annualised revenue decline of 3.3% by the end of 2024. This indicates a significant reduction from annual growth of 24% over the last three years. By contrast, our data suggests that other companies (with analyst coverage) in the same industry are forecast to see their revenue grow 3.1% annually for the foreseeable future. It's pretty clear that BRC's revenues are expected to perform substantially worse than the wider industry.
The Bottom Line
The most important thing to take away is that analysts cut their earnings per share estimates, expecting a clear decline in business conditions. Unfortunately analysts also downgraded their revenue estimates, and industry data suggests that BRC's revenues are expected to grow slower than the wider market. The consensus price target fell measurably, with analysts seemingly not reassured by recent business developments, leading to a lower estimate of BRC's future valuation. Given the stark change in sentiment, we'd understand if investors became more cautious on BRC after today.
With that said, the long-term trajectory of the company's earnings is a lot more important than next year. We have estimates - from multiple BRC analysts - going out to 2026, 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 with high insider ownership.
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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.
