Market forces rained on the parade of Pangaea Logistics Solutions, Ltd. (NASDAQ:PANL) shareholders today, when the analysts 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. At US$7.79, shares are up 6.0% in the past 7 days. It will be interesting to see if this downgrade motivates investors to start selling their holdings.
Following the latest downgrade, the current consensus, from the three analysts covering Pangaea Logistics Solutions, is for revenues of US$449m in 2024, which would reflect an uncomfortable 8.4% reduction in Pangaea Logistics Solutions' sales over the past 12 months. Before the latest update, the analysts were foreseeing US$509m of revenue in 2024. The consensus view seems to have become more pessimistic on Pangaea Logistics Solutions, noting the substantial drop in revenue estimates in this update.
NasdaqCM:PANL Earnings and Revenue Growth May 14th 2024
Looking at the bigger picture now, one of the ways we can make sense of these forecasts is to see how they measure up against both past performance and industry growth estimates. These estimates imply that sales are expected to slow, with a forecast annualised revenue decline of 11% by the end of 2024. This indicates a significant reduction from annual growth of 11% over the last five years. Yet aggregate analyst estimates for other companies in the industry suggest that industry revenues are forecast to decline 0.3% per year. The forecasts do look bearish for Pangaea Logistics Solutions, since they're expecting it to shrink faster than the industry.
The Bottom Line
The most important thing to take away is that analysts cut their revenue estimates for this year. They're also forecasting for revenues to shrink at a quicker rate than companies in the wider market. Overall, given the drastic downgrade to this year's forecasts, we'd be feeling a little more wary of Pangaea Logistics Solutions going forwards.
Hungry for more information? At least one of Pangaea Logistics Solutions' three analysts 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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