The latest analyst coverage could presage a bad day for Kimball Electronics, Inc. (NASDAQ:KE), 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 the downgrade, the consensus from Kimball Electronics' five analysts is for revenues of US$1.5b in 2025, which would reflect an uncomfortable 11% decline in sales compared to the last year of performance. Per-share earnings are expected to shoot up 26% to US$1.04. Previously, the analysts had been modelling revenues of US$1.8b and earnings per share (EPS) of US$1.83 in 2025. It looks like analyst sentiment has declined substantially, with a measurable cut to revenue estimates and a pretty serious decline to earnings per share numbers as well.

Check out our latest analysis for Kimball Electronics

It'll come as no surprise then, to learn that the analysts have cut their price target 17% to US$24.00.

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 sales are expected to reverse, with a forecast 11% annualised revenue decline to the end of 2025. That is a notable change from historical growth of 10% 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 7.4% per year. It's pretty clear that Kimball Electronics' revenues are expected to perform substantially worse than the wider industry.

The Bottom Line

The biggest issue in the new estimates is that analysts have reduced their earnings per share estimates, suggesting business headwinds lay ahead for Kimball Electronics. Unfortunately analysts also downgraded their revenue estimates, and industry data suggests that Kimball Electronics' revenues are expected to grow slower than the wider market. With a serious cut to this year's expectations and a falling price target, we wouldn't be surprised if investors were becoming wary of Kimball Electronics.

Unfortunately, the earnings downgrade - if accurate - may also place pressure on Kimball Electronics' mountain of debt, which could lead to some belt tightening for shareholders. See why we're concerned about Kimball Electronics' balance sheet by visiting our risks dashboard for free on our platform here.