Today is shaping up negative for Galaxy Digital Inc. (NASDAQ:GLXY) shareholders, with the analysts delivering a substantial negative revision to this year's forecasts. 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.

Following the downgrade, the consensus from twelve analysts covering Galaxy Digital is for revenues of US$38b in 2026, implying a sizeable 35% decline in sales compared to the last 12 months. Losses are supposed to balloon 77% to US$0.62 per share. However, before this estimates update, the consensus had been expecting revenues of US$44b and US$0.33 per share in losses. So there's been quite a change-up of views after the recent consensus updates, with the analysts making a serious cut to their revenue forecasts while also expecting losses per share to increase.

There was no major change to the consensus price target of US$39.97, signalling that the business is performing roughly in line with expectations, despite lower earnings per share forecasts.

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Galaxy Digital's past performance and to peers in the same industry. These estimates imply that sales are expected to slow, with a forecast annualised revenue decline of 57% by the end of 2026. This indicates a significant reduction from annual growth of 66% 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 5.6% per year. So although its revenues are forecast to shrink, this cloud does not come with a silver lining - Galaxy Digital is expected to lag the wider industry.

The Bottom Line

The most important thing to take away is that analysts increased their loss per share estimates for this year. Regrettably, they also downgraded their revenue estimates, and the latest forecasts imply the business will grow sales slower than the wider market. 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 Galaxy Digital.

That said, the analysts might have good reason to be negative on Galaxy Digital, given recent substantial insider selling. Learn more, and discover the 2 other concerns we've identified, for 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.

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.