SAIC Motor Corporation Limited Just Missed EPS By 5.8%: Here's What Analysts Think Will Happen Next

The annual results for SAIC Motor Corporation Limited (SHSE:600104) were released last week, making it a good time to revisit its performance. It looks like the results were a bit of a negative overall. While revenues of CN¥745b were in line with analyst predictions, statutory earnings were less than expected, missing estimates by 5.8% to hit CN¥1.23 per share. Following the result, the analysts have updated their earnings model, and it would be good to know whether they think there's been a strong change in the company's prospects, or if it's business as usual. So we collected the latest post-earnings statutory consensus estimates to see what could be in store for next year.

See our latest analysis for SAIC Motor

Taking into account the latest results, the current consensus from SAIC Motor's 16 analysts is for revenues of CN¥776.1b in 2024. This would reflect a modest 4.2% increase on its revenue over the past 12 months. Statutory earnings per share are predicted to rise 6.3% to CN¥1.32. Before this earnings report, the analysts had been forecasting revenues of CN¥764.8b and earnings per share (EPS) of CN¥1.43 in 2024. The analysts seem to have become a little more negative on the business after the latest results, given the small dip in their earnings per share numbers for next year.

It might be a surprise to learn that the consensus price target was broadly unchanged at CN¥14.99, with the analysts clearly implying that the forecast decline in earnings is not expected to have much of an impact on valuation. The consensus price target is just an average of individual analyst targets, so - it could be handy to see how wide the range of underlying estimates is. There are some variant perceptions on SAIC Motor, with the most bullish analyst valuing it at CN¥20.87 and the most bearish at CN¥10.00 per share. Note the wide gap in analyst price targets? This implies to us that there is a fairly broad range of possible scenarios for the underlying business.

Of course, another way to look at these forecasts is to place them into context against the industry itself. For example, we noticed that SAIC Motor's rate of growth is expected to accelerate meaningfully, with revenues forecast to exhibit 4.2% growth to the end of 2024 on an annualised basis. That is well above its historical decline of 3.0% a year over the past five years. Compare this against analyst estimates for the broader industry, which suggest that (in aggregate) industry revenues are expected to grow 20% annually for the foreseeable future. Although SAIC Motor's revenues are expected to improve, it seems that the analysts are still bearish on the business, forecasting it to grow slower than the broader industry.

The Bottom Line

The biggest concern is that the analysts reduced their earnings per share estimates, suggesting business headwinds could lay ahead for SAIC Motor. On the plus side, there were no major changes to revenue estimates; although forecasts imply they will perform worse than the wider industry. There was no real change to the consensus price target, suggesting that the intrinsic value of the business has not undergone any major changes with the latest estimates.

Following on from that line of thought, we think that the long-term prospects of the business are much more relevant than next year's earnings. We have forecasts for SAIC Motor going out to 2026, and you can see them free on our platform here.

Plus, you should also learn about the 1 warning sign we've spotted with SAIC Motor .

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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.