One thing we could say about the analysts on Orion Energy Systems, Inc. (NASDAQ:OESX) - they aren't optimistic, having just made a major negative revision to their near-term (statutory) forecasts for the organization. Both revenue and earnings per share (EPS) estimates were cut sharply as analysts factored in the latest outlook for the business, concluding that they were too optimistic previously.

Following the downgrade, the current consensus from Orion Energy Systems' twin analysts is for revenues of US$105m in 2025 which - if met - would reflect a major 22% increase on its sales over the past 12 months. Losses are predicted to fall substantially, shrinking 42% to US$0.33 per share. Yet prior to the latest estimates, the analysts had been forecasting revenues of US$127m and losses of US$0.17 per share in 2025. So there's been quite a change-up of views after the recent consensus updates, with the analysts making a serious cut to their revenue forecasts while also expecting losses per share to increase.

See our latest analysis for Orion Energy Systems

The consensus price target fell 44% to US$2.50, implicitly signalling that lower earnings per share are a leading indicator for Orion Energy Systems' valuation.

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Orion Energy Systems' past performance and to peers in the same industry. One thing stands out from these estimates, which is that Orion Energy Systems is forecast to grow faster in the future than it has in the past, with revenues expected to display 17% annualised growth until the end of 2025. If achieved, this would be a much better result than the 3.4% annual decline over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in the industry are forecast to see their revenue grow 8.0% per year. So it looks like Orion Energy Systems is expected to grow faster than its competitors, at least for a while.

The Bottom Line

The most important thing to take away is that analysts increased their loss per share estimates for next year. Unfortunately, analysts also downgraded their revenue estimates, although our data indicates revenues are expected to perform better than the wider market. With a serious cut to next year's expectations and a falling price target, we wouldn't be surprised if investors were becoming wary of Orion Energy Systems.

With that said, the long-term trajectory of the company's earnings is a lot more important than next year. At least one analyst has provided forecasts out to 2026, which can be seen for free on our platform here.