This Olam Group Limited (SGX:VC2) Analyst Is Way More Bearish Than They Used To Be
Today is shaping up negative for Olam Group Limited (SGX:VC2) shareholders, with the covering analyst delivering a substantial negative revision to this year's forecasts. Both revenue and earnings per share (EPS) forecasts went under the knife, suggesting the analyst has soured majorly on the business.
Following the latest downgrade, the current consensus, from the sole analyst covering Olam Group, is for revenues of S$24b in 2026, which would reflect an uneasy 12% reduction in Olam Group's sales over the past 12 months. Per-share earnings are expected to surge 524% to S$0.049. Previously, the analyst had been modelling revenues of S$31b and earnings per share (EPS) of S$0.094 in 2026. It looks like analyst sentiment has declined substantially, with a pretty serious reduction to revenue estimates and a large cut to earnings per share numbers as well.
Check out our latest analysis for Olam Group
The consensus price target fell 9.4% to S$1.45, with the weaker earnings outlook clearly leading analyst valuation estimates.
These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Olam Group's past performance and to peers in the same industry. We would also point out that the forecast 12% annualised revenue decline to the end of 2026 is roughly in line with the historical trend, which saw revenues shrink 14% annually over the past five years Compare this against analyst estimates for companies in the broader industry, which suggest that revenues (in aggregate) are expected to grow 8.2% annually. So it's pretty clear that, while it does have declining revenues, the analyst also expect Olam Group to suffer worse than the wider industry.
The Bottom Line
The most important thing to take away is that the analyst cut their earnings per share estimates, expecting a clear decline in business conditions. Unfortunately the analyst also downgraded their revenue estimates, and industry data suggests that Olam Group's revenues are expected to grow slower than the wider market. After such a stark change in sentiment from the analyst, we'd understand if readers now felt a bit wary of Olam Group.
With that said, the long-term trajectory of the company's earnings is a lot more important than next year. At least one analyst has provided forecasts out to 2028, which can be seen for free on our platform here.
Another way to search for interesting companies that could be reaching an inflection point is to track whether management are buying or selling, with our free list of growing companies backed by insiders.
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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.