One Analyst Thinks Jubilee Metals Group PLC's (LON:JLP) Revenues Are Under Threat

The analyst covering Jubilee Metals Group PLC (LON:JLP) delivered a dose of negativity to shareholders today, by making a substantial revision to their statutory 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 most recent consensus for Jubilee Metals Group from its solitary analyst is for revenues of UK£161m in 2023 which, if met, would be a meaningful 15% increase on its sales over the past 12 months. Prior to the latest estimates, the analyst was forecasting revenues of UK£234m in 2023. The consensus view seems to have become more pessimistic on Jubilee Metals Group, noting the sizeable cut to revenue estimates in this update.

See our latest analysis for Jubilee Metals Group

Notably, the analyst has cut their price target 15% to UK£0.17, suggesting concerns around Jubilee Metals Group's valuation.

Of course, another way to look at these forecasts is to place them into context against the industry itself. It's pretty clear that there is an expectation that Jubilee Metals Group's revenue growth will slow down substantially, with revenues to the end of 2023 expected to display 15% growth on an annualised basis. This is compared to a historical growth rate of 46% over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to see their revenue shrink 1.3% per year. Factoring in the forecast slowdown in growth, it's pretty clear that Jubilee Metals Group is still expected to grow faster than the wider industry.

The Bottom Line

The clear low-light was that the analyst slashing their revenue forecasts for Jubilee Metals Group this year. The analyst also expects revenues to perform better than the wider market. The consensus price target fell measurably, with the analyst seemingly not reassured by recent business developments, leading to a lower estimate of Jubilee Metals Group's future valuation. Often, one downgrade can set off a daisy-chain of cuts, especially if an industry is in decline. So we wouldn't be surprised if the market became a lot more cautious on Jubilee Metals Group after today.

Unanswered questions? One Jubilee Metals Group broker/analyst has provided estimates out to 2025, which can be seen for 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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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.

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