A sales decline period disrupts the time series of earnings and, consequently, reduces their predictability. Such a situation can lead to inappropriate decisions by investors. Therefore, managers need to respond appropriately to negative news resulting from sales decline. Manager response is related to forecasting future sales situations, which could affect risk to the firm. Accordingly, the purpose of this study is to investigate the effect of managers' forecasts of future sales on the risk of companies that have experienced sales decline. In this study, the ratio of the changes in operating profit margin was used to compare companies with optimistic and pessimistic managers. To investigate the research hypotheses, the Fama-French five-factor model was used to depict a period of 11 years, from 2007 to 2017, for the companies that are accepted in the Tehran Stock Exchange. It should be noted that the market beta of the Fama-French five-factor model is distinguished by upside potential and downside risk factors, making it possible to study them individually. The findings imply that in companies with optimistic managers, the upside potential is more than the downside risk, but in companies with pessimistic managers, there is no significant difference between the upside potential and the downside risk. Keywords: Sales decline, Upside potential, Downside risk, Fama-French five-factor model, Fama-French six-factor model.