Shareholders in Diurnal Group plc (LON:DNL) may be thrilled to learn that the analysts have just delivered a major upgrade to their near-term forecasts. The revenue forecast for this year has experienced a facelift, with the analysts now much more optimistic on its sales pipeline.
After the upgrade, the consensus from Diurnal Group's two analysts is for revenues of UK£6.1m in 2021, which would reflect a noticeable 3.7% decline in sales compared to the last year of performance. Before the latest update, the analysts were foreseeing UK£4.7m of revenue in 2021. It looks like there's been a clear increase in optimism around Diurnal Group, given the great increase in revenue forecasts.
These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Diurnal Group's past performance and to peers in the same industry. We would highlight that sales are expected to reverse, with the forecast 3.7% revenue decline a notable change from historical growth of 502% over the last year. By contrast, our data suggests that other companies (with analyst coverage) in the same industry are forecast to see their revenue grow 4.8% annually for the foreseeable future. So although its revenues are forecast to shrink, this cloud does not come with a silver lining - Diurnal Group is expected to lag the wider industry.
The Bottom Line
The most important thing to take away from this upgrade is that analysts lifted their revenue estimates for this year. They also expect company revenue to perform worse than the wider market. Seeing the dramatic upgrade to this year's forecasts, it might be time to take another look at Diurnal Group.
Looking to learn more? We have analyst estimates for Diurnal Group going out to 2023, and you can see them free on our platform here.
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This article by Simply Wall St is general in nature. 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.
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