Shenzhen Kedali Industry Co., Ltd. Just Beat Revenue Estimates By 6.5%

Shenzhen Kedali Industry Co., Ltd. (SZSE:002850) shareholders are probably feeling a little disappointed, since its shares fell 3.9% to CN¥70.22 in the week after its latest second-quarter results. It was a workmanlike result, with revenues of CN¥2.9b coming in 6.5% ahead of expectations, and statutory earnings per share of CN¥1.26, in line with analyst appraisals. The analysts typically update their forecasts at each earnings report, and we can judge from their estimates whether their view of the company has changed or if there are any new concerns to be aware of. 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 Shenzhen Kedali Industry

Taking into account the latest results, the current consensus from Shenzhen Kedali Industry's 13 analysts is for revenues of CN¥12.6b in 2024. This would reflect a decent 14% increase on its revenue over the past 12 months. Per-share earnings are expected to rise 5.6% to CN¥5.23. Yet prior to the latest earnings, the analysts had been anticipated revenues of CN¥12.8b and earnings per share (EPS) of CN¥5.23 in 2024. So it's pretty clear that, although the analysts have updated their estimates, there's been no major change in expectations for the business following the latest results.

It will come as no surprise then, to learn that the consensus price target is largely unchanged at CN¥108. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. Currently, the most bullish analyst values Shenzhen Kedali Industry at CN¥124 per share, while the most bearish prices it at CN¥92.03. With such a narrow range of valuations, the analysts apparently share similar views on what they think the business is worth.

Of course, another way to look at these forecasts is to place them into context against the industry itself. We would highlight that Shenzhen Kedali Industry's revenue growth is expected to slow, with the forecast 30% annualised growth rate until the end of 2024 being well below the historical 39% p.a. growth over the last five years. By way of comparison, the other companies in this industry with analyst coverage are forecast to grow their revenue at 18% annually. So it's pretty clear that, while Shenzhen Kedali Industry's revenue growth is expected to slow, it's still expected to grow faster than the industry itself.

The Bottom Line

The most obvious conclusion is that there's been no major change in the business' prospects in recent times, with the analysts holding their earnings forecasts steady, in line with previous estimates. Fortunately, they also reconfirmed their revenue numbers, suggesting that it's tracking in line with expectations. Additionally, our data suggests that revenue is expected to grow faster than the wider industry. The consensus price target held steady at CN¥108, with the latest estimates not enough to have an impact on their price targets.

With that said, the long-term trajectory of the company's earnings is a lot more important than next year. We have estimates - from multiple Shenzhen Kedali Industry analysts - going out to 2026, and you can see them free on our platform here.

It is also worth noting that we have found 1 warning sign for Shenzhen Kedali Industry that you need to take into consideration.

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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.