What You Need To Know About The EnLink Midstream, LLC (NYSE:ENLC) Analyst Downgrade Today

Today is shaping up negative for EnLink Midstream, LLC (NYSE:ENLC) shareholders, with the analysts delivering a substantial negative revision to next year's forecasts. Revenue estimates were cut sharply as analysts signalled a weaker outlook - perhaps a sign that investors should temper their expectations as well.

After this downgrade, EnLink Midstream's six analysts are now forecasting revenues of US$4.2b in 2021. This would be a reasonable 5.6% improvement in sales compared to the last 12 months. Prior to the latest estimates, the analysts were forecasting revenues of US$5.6b in 2021. It looks like forecasts have become a fair bit less optimistic on EnLink Midstream, given the sizeable cut to revenue estimates.

View our latest analysis for EnLink Midstream

Taking a look at the bigger picture now, one of the ways we can understand these forecasts is to see how they compare to both past performance and industry growth estimates. We would highlight that EnLink Midstream's revenue growth is expected to slow, with forecast 5.6% increase next year well below the historical 7.2% p.a. growth over the last five years. By way of comparison, the other companies in this industry with analyst coverage are forecast to grow their revenue at 9.3% per year. So it's pretty clear that, while revenue growth is expected to slow down, the wider industry is also expected to grow faster than EnLink Midstream.

The Bottom Line

The most important thing to take away is that analysts cut their revenue estimates for next year. They also expect company revenue to perform worse than the wider market. Given the stark change in sentiment, we'd understand if investors became more cautious on EnLink Midstream after today.

There might be good reason for analyst bearishness towards EnLink Midstream, like dilutive stock issuance over the past year. 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.

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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