The Tyro (ASX:TYR) share price had another stinker on Thursday. Here's why

Some analysts weren't impressed by Tyro's AGM…

| More on:
A group of disappointed board members.

Image source: Getty Images

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

To the disappointment of shareholders, the Tyro Payments Ltd (ASX: TYR) share price endured another negative session today. Interestingly, the deepening decline occurred despite there being no new announcements from the payments solutions company.

Unfortunately, the Tyro Payments share price finished 4.35% lower to $3.30 by the end of the day. As a result, the company's shares are now closer to their 52-week low than they are to their 52-week high.

With no news from the company itself, we'll need to dig deeper into what's going on.

Analyst downgrades hit Tyro share price

It appears investors weren't done with selling down their Tyro shares today after its steep fall yesterday. For reference, the company held its annual general meeting (AGM) for FY22 yesterday.

At this event, management refrained from giving guidance and warned of increased expenses as it looks to expand operations. A 15% sell-off in the Tyro share price shortly followed.

Today, two brokers have shared a negative perspective on Tyro following its AGM.

Firstly, analysts at Jefferies pointed out a reduction in gross profit growth from 24% to 14% from July to October. Jefferies suggested this was likely due to lower terminal rental fees, among other things. Citing this, the analysts decreased their price target from $4.00 to $3.60. Yet, this target is still around 9% above the current Tyro share price.

Similarly, senior analyst Richard Coles from Morgans shared some concerns over the company's gross profits today. According to the note, Coles believes the FY22 gross profit forecast of $159 million is a stretch. For this reason, the Morgans team downgraded its FY22 and FY23 earnings per share (EPS) forecasts for Tyro by more than 10%.

Additionally, the broker reduced its Tyro share price target but retained its add rating — drawing on the company's potential long-term growth.

Motley Fool contributor Mitchell Lawler has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. owns shares of and has recommended Tyro Payments. The Motley Fool Australia has recommended Tyro Payments. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

More on Technology Shares

Man holding a calculator with Australian dollar notes, symbolising dividends.
Technology Shares

$10,000 invested in DroneShield shares 5 years ago is now worth…

You might be laughing all the way to the bank if you had done this.

Read more »

Happy woman working on a laptop.
Technology Shares

Up 60% since April, why this $40 billion ASX 200 tech stock remains a 'compelling buy' today

A leading expert believes this $40 billion ASX 200 tech stock has a lengthy growth runway ahead of it yet.

Read more »

A man holds his head in his hands, despairing at the bad result he's reading on his computer.
Technology Shares

DroneShield shares sink 7% despite big news

Let's see what's going on with this market darling on Thursday.

Read more »

A man activates an arrow shooting up into a cloud sign on his iPad.
Technology Shares

Up 25% since April, is it too late to buy Xero shares today?

A leading expert gives his verdict on the growth outlook for Xero shares.

Read more »

Man looking at digital holograms of graphs, charts, and data.
Technology Shares

2 amazing ASX tech shares I wish I'd bought last year

These tech companies are among the world’s best companies.

Read more »

A man in a business suit and tie places three wooden blocks with the numbers 1, 2, and 3 on them on top of each other.
Broker Notes

3 reasons to buy this booming ASX All Ords tech stock today

A leading broker forecasts more gains to come from this surging ASX All Ords tech stock.

Read more »

Man ponders a receipt as he looks at his laptop.
Technology Shares

Brokers rerate 3 leading ASX 200 tech stocks

Experts reveal their ratings on the ASX 200 tech sector's three biggest companies.

Read more »

Hologram of a man next to a human robot, symbolising artificial intelligence.
AI Stocks

Why Macquarie forecasts a big rebound for these 2 quality ASX All Ords tech stocks

Macquarie expects a big rebound is coming for these AI linked, ASX All Ords tech stocks.

Read more »