Analyst Forecasts Just Got A Whole Lot More Bearish On Studio City International Holdings Limited (NYSE:MSC)
Market forces rained on the parade of Studio City International Holdings Limited (NYSE:MSC) shareholders today, when the analysts downgraded their forecasts for this year. There was a fairly draconian cut to their revenue estimates, perhaps an implicit admission that previous forecasts were much too optimistic.
Following the latest downgrade, the current consensus, from the dual analysts covering Studio City International Holdings, is for revenues of US$188m in 2020, which would reflect a painful 63% reduction in Studio City International Holdings' sales over the past 12 months. Before the latest update, the analysts were foreseeing US$367m of revenue in 2020. The consensus view seems to have become more pessimistic on Studio City International Holdings, noting the sizeable cut to revenue estimates in this update.
See our latest analysis for Studio City International Holdings
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. Over the past year, revenues have declined around 9.4% annually. Worse, forecasts are essentially predicting the decline to accelerate, with the estimate for a 63% decline in revenue next year. Compare this against analyst estimates for companies in the wider industry, which suggest that revenues (in aggregate) are expected to grow 17% next year. So it's pretty clear that, while it does have declining revenues, the analysts also expect Studio City International Holdings to suffer worse than the wider industry.
The Bottom Line
The most important thing to take away is that analysts cut their revenue estimates for this year. They also expect company revenue to perform worse than the wider market. 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 Studio City International Holdings after today.
Want to learn more? We have estimates for Studio City International Holdings from its dual analysts out until 2022, and you can see them 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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