Today is shaping up negative for Olink Holding AB (publ) (NASDAQ:OLK) shareholders, with the analysts delivering a substantial negative revision to this year's forecasts. There was a fairly draconian cut to their revenue estimates, perhaps an implicit admission that previous forecasts were much too optimistic.
After this downgrade, Olink Holding's four analysts are now forecasting revenues of US$201m in 2024. This would be a decent 19% improvement in sales compared to the last 12 months. The loss per share is anticipated to greatly reduce in the near future, narrowing 51% to US$0.12. Prior to this update, the analysts had been forecasting revenues of US$249m and earnings per share (EPS) of US$0.05 in 2024. There looks to have been a major change in sentiment regarding Olink Holding's prospects, with a measurable cut to revenues and the analysts now forecasting a loss instead of a profit.
Taking a look at the bigger picture now, one of the ways we can understand these forecasts is to see how they compare to both past performance and industry growth estimates. We would highlight that Olink Holding's revenue growth is expected to slow, with the forecast 19% annualised growth rate until the end of 2024 being well below the historical 35% p.a. growth over the last three years. Juxtapose this against the other companies in the industry with analyst coverage, which are forecast to grow their revenues (in aggregate) 6.0% per year. So it's pretty clear that, while Olink Holding's revenue growth is expected to slow, it's still expected to grow faster than the industry itself.
The Bottom Line
The most important thing to take away is that analysts are expecting Olink Holding to become unprofitable this year. Unfortunately, analysts also downgraded their revenue estimates, although our data indicates revenues are expected to perform better than the wider market. Overall, given the drastic downgrade to this year's forecasts, we'd be feeling a little more wary of Olink Holding going forwards.
Still, the long-term prospects of the business are much more relevant than next year's earnings. At Simply Wall St, we have a full range of analyst estimates for Olink Holding going out to 2026, and you can see them 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 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.
