The latest analyst coverage could presage a bad day for Tellgen Corporation (SZSE:300642), with the analysts making across-the-board cuts to their statutory estimates that might leave shareholders a little shell-shocked. Both revenue and earnings per share (EPS) forecasts went under the knife, suggesting analysts have soured majorly on the business.

After this downgrade, Tellgen's three analysts are now forecasting revenues of CN¥742m in 2022. This would be a notable 10% improvement in sales compared to the last 12 months. Statutory earnings per share are anticipated to shrink 6.9% to CN¥0.74 in the same period. Before this latest update, the analysts had been forecasting revenues of CN¥825m and earnings per share (EPS) of CN¥1.08 in 2022. Indeed, we can see that the analysts are a lot more bearish about Tellgen's prospects, administering a substantial drop in revenue estimates and slashing their EPS estimates to boot.

Check out our latest analysis for Tellgen

The consensus price target fell 8.9% to CN¥30.90, with the weaker earnings outlook clearly leading analyst valuation estimates. That's not the only conclusion we can draw from this data however, as some investors also like to consider the spread in estimates when evaluating analyst price targets. The most optimistic Tellgen analyst has a price target of CN¥39.00 per share, while the most pessimistic values it at CN¥22.79. These price targets show that analysts do have some differing views on the business, but the estimates do not vary enough to suggest to us that some are betting on wild success or utter failure.

Of course, another way to look at these forecasts is to place them into context against the industry itself. The period to the end of 2022 brings more of the same, according to the analysts, with revenue forecast to display 22% growth on an annualised basis. That is in line with its 20% annual growth over the past five years. Compare this with the broader industry, which analyst estimates (in aggregate) suggest will see revenues grow 22% annually. It's clear that while Tellgen's revenue growth is expected to continue on its current trajectory, it's only expected to grow in line with the industry itself.

The Bottom Line

The biggest issue in the new estimates is that analysts have reduced their earnings per share estimates, suggesting business headwinds lay ahead for Tellgen. There was also a drop in their revenue estimates, although as we saw earlier, forecast growth is only expected to be about the same as the wider market. With a serious cut to this year's expectations and a falling price target, we wouldn't be surprised if investors were becoming wary of Tellgen.

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 Tellgen analysts - going out to 2024, 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 that insiders are buying.

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