Yahoo Finance One Marcus & Millichap, Inc. (NYSE:MMI) Analyst Just Cut Their EPS Forecasts
The analyst covering Marcus & Millichap, Inc. (NYSE:MMI) delivered a dose of negativity to shareholders today, by making a substantial revision to their statutory forecasts for next year. Both revenue and earnings per share (EPS) estimates were cut sharply as the analyst factored in the latest outlook for the business, concluding that they were too optimistic previously.
Following the latest downgrade, the current consensus, from the single analyst covering Marcus & Millichap, is for revenues of US$1.2b in 2023, which would reflect a substantial 24% reduction in Marcus & Millichap's sales over the past 12 months. Statutory earnings per share are anticipated to nosedive 58% to US$1.70 in the same period. Prior to this update, the analyst had been forecasting revenues of US$1.6b and earnings per share (EPS) of US$3.88 in 2023. Indeed, we can see that the analyst is a lot more bearish about Marcus & Millichap's prospects, administering a sizeable cut to revenue estimates and slashing their EPS estimates to boot.
See our latest analysis for Marcus & Millichap
It'll come as no surprise then, to learn that the analyst has cut their price target 7.7% to US$24.00.
Looking at the bigger picture now, one of the ways we can make sense of these forecasts is to see how they measure up against both past performance and industry growth estimates. We would highlight that sales are expected to reverse, with a forecast 19% annualised revenue decline to the end of 2023. That is a notable change from historical growth of 15% over the last five years. Compare this with our data, which suggests that other companies in the same industry are, in aggregate, expected to see their revenue grow 2.8% per year. It's pretty clear that Marcus & Millichap's revenues are expected to perform substantially worse than the wider industry.
The Bottom Line
The biggest issue in the new estimates is that the analyst has reduced their earnings per share estimates, suggesting business headwinds lay ahead for Marcus & Millichap. Unfortunately the analyst also downgraded their revenue estimates, and industry data suggests that Marcus & Millichap'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 Marcus & Millichap.
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 Marcus & Millichap's business, like recent substantial insider selling. For more information, you can click here to discover this and the 1 other warning sign we've identified.
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.
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