Earnings Miss: Jiangsu Shentong Valve Co., Ltd. Missed EPS By 7.1% And Analysts Are Revising Their Forecasts

Jiangsu Shentong Valve Co., Ltd. (SZSE:002438) just released its latest yearly report and things are not looking great. Jiangsu Shentong Valve missed analyst forecasts, with revenues of CN¥2.1b and statutory earnings per share (EPS) of CN¥0.53, falling short by 3.3% and 7.1% respectively. 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. With this in mind, we've gathered the latest statutory forecasts to see what the analysts are expecting for next year.

Check out our latest analysis for Jiangsu Shentong Valve

Taking into account the latest results, the consensus forecast from Jiangsu Shentong Valve's three analysts is for revenues of CN¥2.58b in 2024. This reflects a substantial 21% improvement in revenue compared to the last 12 months. Statutory earnings per share are predicted to jump 25% to CN¥0.66. In the lead-up to this report, the analysts had been modelling revenues of CN¥2.67b and earnings per share (EPS) of CN¥0.72 in 2024. The analysts are less bullish than they were before these results, given the reduced revenue forecasts and the minor downgrade to earnings per share expectations.

Despite the cuts to forecast earnings, there was no real change to the CN¥13.75 price target, showing that the analysts don't think the changes have a meaningful impact on its intrinsic value. 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. There are some variant perceptions on Jiangsu Shentong Valve, with the most bullish analyst valuing it at CN¥14.10 and the most bearish at CN¥13.40 per share. Still, with such a tight range of estimates, it suggeststhe analysts have a pretty good idea of what they think the company is worth.

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. It's clear from the latest estimates that Jiangsu Shentong Valve's rate of growth is expected to accelerate meaningfully, with the forecast 21% annualised revenue growth to the end of 2024 noticeably faster than its historical growth of 12% p.a. over the past five years. Other similar companies in the industry (with analyst coverage) are also forecast to grow their revenue at 17% per year. Factoring in the forecast acceleration in revenue, it's pretty clear that Jiangsu Shentong Valve is expected to grow at about the same rate as 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 their revenue estimates, although as we saw earlier, forecast growth is only expected to be about the same as the wider industry. The consensus price target held steady at CN¥13.75, with the latest estimates not enough to have an impact on their price targets.

With that said, the long-term trajectory of the company's earnings is a lot more important than next year. At Simply Wall St, we have a full range of analyst estimates for Jiangsu Shentong Valve going out to 2026, and you can see them free on our platform here..

You can also view our analysis of Jiangsu Shentong Valve's balance sheet, and whether we think Jiangsu Shentong Valve is carrying too much debt, for free on our platform here.

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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.