Market forces rained on the parade of Anton Oilfield Services Group (HKG:3337) shareholders today, when the analysts downgraded their forecasts for this year. There was a fairly draconian cut to their revenue estimates, perhaps an implicit admission that previous forecasts were much too optimistic.

After the downgrade, the consensus from Anton Oilfield Services Group's nine analysts is for revenues of CN¥3.5b in 2020, which would reflect a perceptible 3.4% decline in sales compared to the last year of performance. Prior to the latest estimates, the analysts were forecasting revenues of CN¥4.1b in 2020. It looks like forecasts have become a fair bit less optimistic on Anton Oilfield Services Group, given the measurable cut to revenue estimates.

View our latest analysis for Anton Oilfield Services Group

The consensus price target fell 28% to CN¥0.76, with the analysts clearly less optimistic about Anton Oilfield Services Group's valuation following this update. Fixating on a single price target can be unwise though, since the consensus target is effectively the average of analyst price targets. As a result, some investors like to look at the range of estimates to see if there are any diverging opinions on the company's valuation. Currently, the most bullish analyst values Anton Oilfield Services Group at CN¥1.35 per share, while the most bearish prices it at CN¥0.41. With such a wide range in price targets, the analysts are almost certainly betting on widely diverse outcomes for the underlying business. As a result it might not be possible to derive much meaning from the consensus price target, which is after all just an average of this wide range of estimates.

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Anton Oilfield Services Group's past performance and to peers in the same industry. We would highlight that sales are expected to reverse, with the forecast 3.4% revenue decline a notable change from historical growth of 16% over the last five years. Compare this with our data, which suggests that other companies in the same industry are, in aggregate, expected to see their revenue grow 5.2% next year. It's pretty clear that Anton Oilfield Services Group's revenues are expected to perform substantially worse than the wider industry.

The Bottom Line

The clear low-light was that analysts slashing their revenue forecasts for Anton Oilfield Services Group this year. They're also anticipating slower revenue growth than the wider market. After such a stark change in sentiment from analysts, we'd understand if readers now felt a bit wary of Anton Oilfield Services Group.

As you can see, the analysts clearly aren't bullish, and there might be good reason for that. We've identified some potential issues with Anton Oilfield Services Group's financials, such as dilutive stock issuance over the past year. For more information, you can click here to discover this and the 2 other risks 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.

If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.com. 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. Simply Wall St has no position in the stocks mentioned.

We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Thank you for reading.