The analysts covering Westrock Coffee Company (NASDAQ:WEST) 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 analysts factored in the latest outlook for the business, concluding that they were too optimistic previously.

After the downgrade, the five analysts covering Westrock Coffee are now predicting revenues of US$1.0b in 2025. If met, this would reflect a major 21% improvement in sales compared to the last 12 months. The loss per share is anticipated to greatly reduce in the near future, narrowing 91% to US$0.07. Previously, the analysts had been modelling revenues of US$1.1b and earnings per share (EPS) of US$0.17 in 2025. There looks to have been a major change in sentiment regarding Westrock Coffee's prospects, with a substantial drop in revenues and the analysts now forecasting a loss instead of a profit.

View our latest analysis for Westrock Coffee

The consensus price target fell 6.6% to US$11.40, implicitly signalling that lower earnings per share are a leading indicator for Westrock Coffee's valuation.

Of course, another way to look at these forecasts is to place them into context against the industry itself. It's clear from the latest estimates that Westrock Coffee's rate of growth is expected to accelerate meaningfully, with the forecast 17% annualised revenue growth to the end of 2025 noticeably faster than its historical growth of 5.3% p.a. over the past three years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to grow their revenue at 2.8% per year. Factoring in the forecast acceleration in revenue, it's pretty clear that Westrock Coffee is expected to grow much faster than its industry.

The Bottom Line

The most important thing to take away is that analysts are expecting Westrock Coffee to become unprofitable next year. While analysts did downgrade their revenue estimates, these forecasts still imply revenues will 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 Westrock Coffee.

With that said, the long-term trajectory of the company's earnings is a lot more important than next year. At Simply Wall St, we have a full range of analyst estimates for Westrock Coffee 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 backed by insiders.

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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.