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With its credibility torn to pieces after three downgrades in as many months you can’t blame Robert Sanders at Sigma Capital’s house broker Arbuthnot for playing it safe.

Speaking after finals from Sigma last week, Sanders says: ‘I’ve kitchen sinked it as much as possible for the numbers this year and am leaving it open for surprise on the upside.’ Kitchen sinking is not putting it mildly, given that the analyst had just reduced his pre-tax profit for 2008 by 67% from £3 million to £1 million.

That downgrade came as the results revealed pre-tax profits at half the level Sanders had been forecasting, made more shocking given that it follows profit warnings in December and March. The analyst comments: ‘Having missed the numbers three times in the past year they have got to start delivering positive newsflow before anyone is overly keen.’

Sanders is now forecasting zero contribution from the company’s property business, the source of most of the downgrades, meaning even a modest surprise here could restore some confidence.

by Simon Keane