Keda Industrial Group Co., Ltd. Earnings Missed Analyst Estimates: Here's What Analysts Are Forecasting Now

Shareholders might have noticed that Keda Industrial Group Co., Ltd. (SHSE:600499) filed its yearly result this time last week. The early response was not positive, with shares down 2.0% to CN¥10.53 in the past week. It was not a great result overall. While revenues of CN¥9.7b were in line with analyst predictions, earnings were less than expected, missing statutory estimates by 10% to hit CN¥1.10 per share. Earnings are an important time for investors, as they can track a company's performance, look at what the analysts are forecasting for next year, and see if there's been a change in sentiment towards the company. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether the analysts have changed their mind on Keda Industrial Group after the latest results.

See our latest analysis for Keda Industrial Group

Following the latest results, Keda Industrial Group's four analysts are now forecasting revenues of CN¥12.1b in 2024. This would be a substantial 24% improvement in revenue compared to the last 12 months. Statutory earnings per share are forecast to sink 13% to CN¥0.96 in the same period. Before this earnings report, the analysts had been forecasting revenues of CN¥11.7b and earnings per share (EPS) of CN¥1.23 in 2024. So it's pretty clear the analysts have mixed opinions on Keda Industrial Group after the latest results; even though they upped their revenue numbers, it came at the cost of a pretty serious reduction to per-share earnings expectations.

There's been no major changes to the price target of CN¥15.00, suggesting that the impact of higher forecast revenue and lower earnings won't result in a meaningful change to the business' valuation.

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. It's clear from the latest estimates that Keda Industrial Group's rate of growth is expected to accelerate meaningfully, with the forecast 24% annualised revenue growth to the end of 2024 noticeably faster than its historical growth of 14% p.a. over the past five years. Compare this with other companies in the same industry, which are forecast to grow their revenue 19% annually. Factoring in the forecast acceleration in revenue, it's pretty clear that Keda Industrial Group 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. Pleasantly, they also upgraded their revenue estimates, and their forecasts suggest the business 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. We have forecasts for Keda Industrial Group going out to 2026, and you can see them free on our platform here.

However, before you get too enthused, we've discovered 3 warning signs for Keda Industrial Group (1 is a bit concerning!) that you should be aware of.

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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.