The latest analyst coverage could presage a bad day for Arabian Contracting Services Company (TADAWUL:4071), 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) estimates were cut sharply as the analysts factored in the latest outlook for the business, concluding that they were too optimistic previously.

After the downgrade, the two analysts covering Arabian Contracting Services are now predicting revenues of ر.س1.8b in 2026. If met, this would reflect a reasonable 6.4% improvement in sales compared to the last 12 months. The loss per share is anticipated to greatly reduce in the near future, narrowing 58% to ر.س1.13. Prior to this update, the analysts had been forecasting revenues of ر.س2.1b and earnings per share (EPS) of ر.س1.94 in 2026. So we can see that the consensus has become notably more bearish on Arabian Contracting Services' outlook with these numbers, making a measurable cut to this year's revenue estimates. Furthermore, they expect the business to be loss-making this year, compared to their previous forecasts of a profit.

The consensus price target fell 6.2% to ر.س96.33, with the analysts clearly concerned about the company following the weaker revenue and earnings outlook.

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 Arabian Contracting Services' revenue growth is expected to slow, with the forecast 6.4% annualised growth rate until the end of 2026 being well below the historical 20% p.a. growth over the last five years. Juxtapose this against the other companies in the industry with analyst coverage, which are forecast to grow their revenues (in aggregate) 6.3% annually. Factoring in the forecast slowdown in growth, it looks like Arabian Contracting Services is forecast to grow at about the same rate as the wider industry.

The Bottom Line

The most important thing to take away is that analysts are expecting Arabian Contracting Services to become unprofitable this year. Lamentably, they also downgraded their sales forecasts, but the business is still expected to grow at roughly the same rate as the market itself. Given the scope of the downgrades, it would not be a surprise to see the market become more wary of the business.

With that said, the long-term trajectory of the company's earnings is a lot more important than next year. We have analyst estimates for Arabian Contracting Services going out as far as 2028, and you can see them free on our platform here.

Of course, seeing company management invest large sums of money in a stock can be just as useful as knowing whether analysts are downgrading their estimates. So you may also wish to search this free list of stocks with high insider ownership.

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.