Pylon Technologies Co., Ltd. Just Missed Revenue By 53%: Here's What Analysts Think Will Happen Next

Investors in Pylon Technologies Co., Ltd. (SHSE:688063) had a good week, as its shares rose 7.8% to close at CN¥40.00 following the release of its quarterly results. Pylon Technologies reported a serious miss, with revenue of CN¥386m falling a huge 53% short of analyst estimates. The bright side is that statutory earnings per share of CN¥2.12 were in line with forecasts. 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.

Check out our latest analysis for Pylon Technologies

Taking into account the latest results, the consensus forecast from Pylon Technologies' five analysts is for revenues of CN¥4.08b in 2024. This reflects a sizeable 155% improvement in revenue compared to the last 12 months. Earnings are expected to improve, with Pylon Technologies forecast to report a statutory profit of CN¥2.17 per share. Before this earnings report, the analysts had been forecasting revenues of CN¥4.17b and earnings per share (EPS) of CN¥2.21 in 2024. So it looks like the analysts have become a bit less optimistic after the latest results announcement, with revenues expected to fall even as the company is supposed to maintain EPS.

The average price target was steady at CN¥60.91even though revenue estimates declined; likely suggesting the analysts place a higher value on earnings. 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. The most optimistic Pylon Technologies analyst has a price target of CN¥77.14 per share, while the most pessimistic values it at CN¥46.00. As you can see, analysts are not all in agreement on the stock's future, but the range of estimates is still reasonably narrow, which could suggest that the outcome is not totally unpredictable.

Taking a look at the bigger picture now, one of the ways we can understand these forecasts is to see how they compare to both past performance and industry growth estimates. The analysts are definitely expecting Pylon Technologies' growth to accelerate, with the forecast 248% annualised growth to the end of 2024 ranking favourably alongside historical growth of 16% per annum over the past three years. Compare this with other companies in the same industry, which are forecast to grow their revenue 16% annually. It seems obvious that, while the growth outlook is brighter than the recent past, the analysts also expect Pylon Technologies to grow faster than the wider industry.

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. Regrettably, they also downgraded their revenue estimates, but the latest forecasts still imply the business will grow faster than the wider industry. Even so, earnings per share are more important to the intrinsic value of the business. 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 estimates - from multiple Pylon Technologies analysts - going out to 2026, and you can see them free on our platform here.

Even so, be aware that Pylon Technologies is showing 1 warning sign in our investment analysis , you should know about...

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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.