Jiangsu Pacific Precision Forging Co., Ltd. Just Missed Earnings And Its Revenue Numbers Were Weaker Than Expected

Investors in Jiangsu Pacific Precision Forging Co., Ltd. (SZSE:300258) had a good week, as its shares rose 8.0% to close at CN¥9.19 following the release of its first-quarter results. Revenues were CN¥504m, 15% below analyst expectations, although losses didn't appear to worsen significantly, with a per-share statutory loss of CN¥0.48 being in line with what the analysts forecast. 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.

View our latest analysis for Jiangsu Pacific Precision Forging

Following the latest results, Jiangsu Pacific Precision Forging's six analysts are now forecasting revenues of CN¥2.73b in 2024. This would be a sizeable 30% improvement in revenue compared to the last 12 months. Per-share earnings are expected to leap 37% to CN¥0.68. Yet prior to the latest earnings, the analysts had been anticipated revenues of CN¥2.70b and earnings per share (EPS) of CN¥0.71 in 2024. So it looks like there's been a small decline in overall sentiment after the recent results - there's been no major change to revenue estimates, but the analysts did make a minor downgrade to their earnings per share forecasts.

The consensus price target held steady at CN¥15.72, with the analysts seemingly voting that their lower forecast earnings are not expected to lead to a lower stock price in the foreseeable future. That's not the only conclusion we can draw from this data however, as some investors also like to consider the spread in estimates when evaluating analyst price targets. The most optimistic Jiangsu Pacific Precision Forging analyst has a price target of CN¥16.00 per share, while the most pessimistic values it at CN¥15.44. Still, with such a tight range of estimates, it suggeststhe analysts have a pretty good idea of what they think the company is worth.

Another way we can view these estimates is in the context of the bigger picture, such as how the forecasts stack up against past performance, and whether forecasts are more or less bullish relative to other companies in the industry. The analysts are definitely expecting Jiangsu Pacific Precision Forging's growth to accelerate, with the forecast 42% annualised growth to the end of 2024 ranking favourably alongside historical growth of 13% per annum over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to grow their revenue at 18% per year. Factoring in the forecast acceleration in revenue, it's pretty clear that Jiangsu Pacific Precision Forging is expected to grow much faster than its industry.

The Bottom Line

The most important thing to take away is that the analysts downgraded their earnings per share estimates, showing that there has been a clear decline in sentiment following these results. 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. 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.

Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. At Simply Wall St, we have a full range of analyst estimates for Jiangsu Pacific Precision Forging 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 Jiangsu Pacific Precision Forging 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.