Market forces rained on the parade of Unique Fabricating, Inc. (NYSEMKT:UFAB) shareholders today, when the covering analyst downgraded their forecasts for this year. This report focused on revenue estimates, and it looks as though the consensus view of the business has become substantially more conservative.
Following the downgrade, the consensus from sole analyst covering Unique Fabricating is for revenues of US$114m in 2020, implying a painful 23% decline in sales compared to the last 12 months. Before the latest update, the analyst was foreseeing US$114m of revenue in 2020. Overall it looks like Unique Fabricating is performing in line with analyst expectations, given the analyst has updated their numbers and there’s been no real change to this year’s forecast following these updates.
These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Unique Fabricating’s past performance and to peers in the same industry. We would highlight that sales are expected to reverse, with the forecast 23% revenue decline a notable change from historical growth of 2.8% 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 10.0% annually for the foreseeable future. It’s pretty clear that Unique Fabricating’s revenues are expected to perform substantially worse than the wider industry.
The Bottom Line
The most important thing to take away is that the analyst reconfirmed their revenue estimates for this year, suggesting that the business is performing in line with market expectations. They’re also anticipating slower revenue growth than the wider market. Overall, given the drastic downgrade to this year’s forecasts, we’d be feeling a little more wary of Unique Fabricating going forwards.
But wait – there’s more! One Unique Fabricating broker/analyst has provided estimates out to 2021, which can be seen for free on our platform here.
Another way to search for interesting companies that could be reaching an inflection point is to track whether management are buying or selling, with our free list of growing companies 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.