Earnings Miss: Aecc Aero-Engine Control Co.,Ltd. Missed EPS By 10% And Analysts Are Revising Their Forecasts

Aecc Aero-Engine Control Co.,Ltd. (SZSE:000738) just released its latest full-year report and things are not looking great. It wasn't a great result overall - while revenue fell marginally short of analyst estimates at CN¥5.3b, statutory earnings missed forecasts by 10%, coming in at just CN¥0.55 per share. This is an important time for investors, as they can track a company's performance in its report, look at what experts are forecasting for next year, and see if there has been any change to expectations for the business. We thought readers would find it interesting to see the analysts latest (statutory) post-earnings forecasts for next year.

View our latest analysis for Aecc Aero-Engine ControlLtd

Taking into account the latest results, the consensus forecast from Aecc Aero-Engine ControlLtd's five analysts is for revenues of CN¥5.99b in 2024. This reflects a solid 12% improvement in revenue compared to the last 12 months. Per-share earnings are expected to expand 19% to CN¥0.66. Before this earnings report, the analysts had been forecasting revenues of CN¥6.74b and earnings per share (EPS) of CN¥0.77 in 2024. It looks like sentiment has declined substantially in the aftermath of these results, with a real cut to revenue estimates and a substantial drop in earnings per share numbers as well.

It'll come as no surprise then, to learn that the analysts have cut their price target 12% to CN¥28.33. 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. There are some variant perceptions on Aecc Aero-Engine ControlLtd, with the most bullish analyst valuing it at CN¥31.00 and the most bearish at CN¥26.00 per share. Even so, with a relatively close grouping of estimates, it looks like the analysts are quite confident in their valuations, suggesting Aecc Aero-Engine ControlLtd is an easy business to forecast or the the analysts are all using similar assumptions.

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 period to the end of 2024 brings more of the same, according to the analysts, with revenue forecast to display 12% growth on an annualised basis. That is in line with its 14% annual growth over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to see their revenues grow 22% per year. So although Aecc Aero-Engine ControlLtd is expected to maintain its revenue growth rate, it's forecast to grow slower 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. On the negative side, they also downgraded their revenue estimates, and forecasts imply they will perform worse than the wider industry. The consensus price target fell measurably, with the analysts seemingly not reassured by the latest results, leading to a lower estimate of Aecc Aero-Engine ControlLtd's future valuation.

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. We have estimates - from multiple Aecc Aero-Engine ControlLtd analysts - going out to 2026, and you can see them free on our platform here.

However, before you get too enthused, we've discovered 1 warning sign for Aecc Aero-Engine ControlLtd that you should be aware of.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

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.