The latest analyst coverage could presage a bad day for Mayville Engineering Company, Inc. (NYSE:MEC), with the analysts making across-the-board cuts to their statutory estimates that might leave shareholders a little shell-shocked. Revenue estimates were cut sharply as the analysts signalled a weaker outlook - perhaps a sign that investors should temper their expectations as well.

Following the latest downgrade, the current consensus, from the four analysts covering Mayville Engineering Company, is for revenues of US$589m in 2025, which would reflect a small 3.3% reduction in Mayville Engineering Company's sales over the past 12 months. Before the latest update, the analysts were foreseeing US$663m of revenue in 2025. The consensus view seems to have become more pessimistic on Mayville Engineering Company, noting the measurable cut to revenue estimates in this update.

Notably, the analysts have cut their price target 20% to US$19.67, suggesting concerns around Mayville Engineering Company's valuation.

Of course, another way to look at these forecasts is to place them into context against the industry itself. We would highlight that sales are expected to reverse, with a forecast 2.6% annualised revenue decline to the end of 2025. That is a notable change from historical growth of 8.1% over the last five years. By contrast, our data suggests that other companies (with analyst coverage) in the same industry are forecast to see their revenue grow 3.1% annually for the foreseeable future. So although its revenues are forecast to shrink, this cloud does not come with a silver lining - Mayville Engineering Company is expected to lag the wider industry.

The Bottom Line

The clear low-light was that analysts slashing their revenue forecasts for Mayville Engineering Company next year. They're also anticipating slower revenue growth than the wider market. The consensus price target fell measurably, with analysts seemingly not reassured by recent business developments, leading to a lower estimate of Mayville Engineering Company's future valuation. Overall, given the drastic downgrade to next year's forecasts, we'd be feeling a little more wary of Mayville Engineering Company going forwards.

After a downgrade like this, it's pretty clear that previous forecasts were too optimistic. What's more, we've spotted several possible issues with Mayville Engineering Company's business, like recent substantial insider selling. Learn more, and discover the 1 other concern we've identified, 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 with high insider ownership.

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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.