Jiangsu Pacific Precision Forging Co., Ltd. Recorded A 15% Miss On Revenue: Analysts Are Revisiting Their Models

It's been a good week for Jiangsu Pacific Precision Forging Co., Ltd. (SZSE:300258) shareholders, because the company has just released its latest quarterly results, and the shares gained 3.2% to CN¥8.64. 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. 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 gathered the latest post-earnings forecasts to see what estimates suggest is in store for next year.

Check out our latest analysis for Jiangsu Pacific Precision Forging

Taking into account the latest results, the current consensus from Jiangsu Pacific Precision Forging's three analysts is for revenues of CN¥2.48b in 2024. This would reflect a sizeable 20% increase on its revenue over the past 12 months. Per-share earnings are expected to leap 69% to CN¥0.58. In the lead-up to this report, the analysts had been modelling revenues of CN¥2.61b and earnings per share (EPS) of CN¥0.61 in 2024. It's pretty clear that pessimism has reared its head after the latest results, leading to a weaker revenue outlook and a small dip in earnings per share estimates.

Despite the cuts to forecast earnings, there was no real change to the CN¥15.44 price target, showing that the analysts don't think the changes have a meaningful impact on its intrinsic value.

Looking at the bigger picture now, one of the ways we can make sense of these forecasts is to see how they measure up against both past performance and industry growth estimates. It's clear from the latest estimates that Jiangsu Pacific Precision Forging's rate of growth is expected to accelerate meaningfully, with the forecast 28% annualised revenue growth to the end of 2024 noticeably faster than its historical growth of 15% p.a. 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. It seems obvious that, while the growth outlook is brighter than the recent past, the analysts also expect Jiangsu Pacific Precision Forging to grow faster than the wider 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. They also downgraded Jiangsu Pacific Precision Forging's revenue estimates, but industry data suggests that it is expected to grow faster than the wider industry. The consensus price target held steady at CN¥15.44, with the latest estimates not enough to have an impact on their price targets.

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. 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 2 warning signs 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.