The latest analyst coverage could presage a bad day for Jumia Technologies AG (NYSE:JMIA), with the analysts making across-the-board cuts to their statutory estimates that might leave shareholders a little shell-shocked. Both revenue and earnings per share (EPS) forecasts went under the knife, suggesting the analysts have soured majorly on the business.

After this downgrade, Jumia Technologies' twin analysts are now forecasting revenues of US$185m in 2025. This would be a meaningful 11% improvement in sales compared to the last 12 months. Losses are presumed to reduce, shrinking 17% per share from last year to US$0.67. However, before this estimates update, the consensus had been expecting revenues of US$220m and US$0.46 per share in losses. Ergo, there's been a clear change in sentiment, with the analysts administering a notable cut to this year's revenue estimates, while at the same time increasing their loss per share forecasts.

Check out our latest analysis for Jumia Technologies

The consensus price target was broadly unchanged at €3.52, perhaps implicitly signalling that the weaker earnings outlook is not expected to have a long-term impact on the valuation. The consensus price target is just an average of individual analyst targets, so - it could be handy to see how wide the range of underlying estimates is. There are some variant perceptions on Jumia Technologies, with the most bullish analyst valuing it at €4.54 and the most bearish at €2.50 per share. There are definitely some different views on the stock, but the range of estimates is not wide enough as to imply that the situation is unforecastable, in our view.

One way to get more context on these forecasts is to look at how they compare to both past performance, and how other companies in the same industry are performing. The analysts are definitely expecting Jumia Technologies' growth to accelerate, with the forecast 11% annualised growth to the end of 2025 ranking favourably alongside historical growth of 1.9% per annum over the past five years. Compare this with other companies in the same industry, which are forecast to grow their revenue 9.4% annually. Jumia Technologies is expected to grow at about the same rate as its industry, so it's not clear that we can draw any conclusions from its growth relative to competitors.

The Bottom Line

The most important thing to note from this downgrade is that the consensus increased its forecast losses this year, suggesting all may not be well at Jumia Technologies. Lamentably, they also downgraded their sales forecasts, but the business is still expected to grow at roughly the same rate as the market itself. The lack of change in the price target is puzzling in light of the downgrade but, with a serious decline expected this year, we wouldn't be surprised if investors were a bit wary of Jumia Technologies.

Still, the long-term prospects of the business are much more relevant than next year's earnings. We have analyst estimates for Jumia Technologies going out as far as 2027, 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.