Today is shaping up negative for Phoenix Global Resources plc (LON:PGR) shareholders, with the covering analyst delivering a substantial negative revision to this year's forecasts. 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 single analyst covering Phoenix Global Resources is for revenues of US$53m in 2020, implying a substantial 59% decline in sales compared to the last 12 months. Before the latest update, the analyst was foreseeing US$61m of revenue in 2020. It looks like forecasts have become a fair bit less optimistic on Phoenix Global Resources, given the substantial drop in revenue estimates.

Check out our latest analysis for Phoenix Global Resources

The consensus price target fell 40% to US$0.15, with the analyst clearly less optimistic about Phoenix Global Resources' valuation following this update.

Taking a look at the bigger picture now, one of the ways we can understand these forecasts is to see how they compare to both past performance and industry growth estimates. These estimates imply that sales are expected to slow, with a forecast revenue decline of 59%, a significant reduction from annual growth of 7.5% 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 13% annually for the foreseeable future. It's pretty clear that Phoenix Global Resources' 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 cut their revenue estimates for this year. They also expect company revenue to perform worse than the wider market. Furthermore, there was a cut to the price target, suggesting that the latest news has led to more pessimism about the intrinsic value of the business. Given the stark change in sentiment, we'd understand if investors became more cautious on Phoenix Global Resources after today.

There might be good reason for analyst bearishness towards Phoenix Global Resources, like a short cash runway. For more information, you can click here to discover this and the 2 other concerns we've identified.

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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