Analysts Just Slashed Their Shenzhen KSTAR Science and Technology Co., Ltd. (SZSE:002518) EPS Numbers

Today is shaping up negative for Shenzhen KSTAR Science and Technology Co., Ltd. (SZSE:002518) shareholders, with the analysts delivering a substantial negative revision to next year's forecasts. Revenue and earnings per share (EPS) forecasts were both revised downwards, with the analysts seeing grey clouds on the horizon.

Following the downgrade, the most recent consensus for Shenzhen KSTAR Science and Technology from its six analysts is for revenues of CN¥5.5b in 2025 which, if met, would be a substantial 28% increase on its sales over the past 12 months. Per-share earnings are expected to shoot up 47% to CN¥1.29. Prior to this update, the analysts had been forecasting revenues of CN¥6.2b and earnings per share (EPS) of CN¥1.53 in 2025. It looks like analyst sentiment has declined substantially, with a substantial drop in revenue estimates and a considerable drop in earnings per share numbers as well.

See our latest analysis for Shenzhen KSTAR Science and Technology

Analysts made no major changes to their price target of CN¥19.67, suggesting the downgrades are not expected to have a long-term impact on Shenzhen KSTAR Science and Technology's valuation.

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Shenzhen KSTAR Science and Technology's past performance and to peers in the same industry. The period to the end of 2025 brings more of the same, according to the analysts, with revenue forecast to display 22% growth on an annualised basis. That is in line with its 18% 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 17% per year. So although Shenzhen KSTAR Science and Technology is expected to maintain its revenue growth rate, it's definitely expected to grow faster than the wider industry.

The Bottom Line

The most important thing to take away is that analysts cut their earnings per share estimates, expecting a clear decline in business conditions. While analysts did downgrade their revenue estimates, these forecasts still imply revenues will perform better than the wider market. The lack of change in the price target is puzzling in light of the downgrade but, with a serious decline expected next year, we wouldn't be surprised if investors were a bit wary of Shenzhen KSTAR Science and Technology.

That said, the analysts might have good reason to be negative on Shenzhen KSTAR Science and Technology, given concerns around earnings quality. For more information, you can click here to discover this and the 1 other concern we've identified.

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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.