Acrel Co.,Ltd. Just Missed Revenue By 9.4%: Here's What Analysts Think Will Happen Next

Acrel Co.,Ltd. (SZSE:300286) just released its latest full-year report and things are not looking great. AcrelLtd missed analyst forecasts, with revenues of CN¥1.1b and statutory earnings per share (EPS) of CN¥0.95, falling short by 9.4% and 4.0% respectively. Following the result, the analysts have updated their earnings model, and it would be good to know whether they think there's been a strong change in the company's prospects, or if it's business as usual. We've gathered the most recent statutory forecasts to see whether the analysts have changed their earnings models, following these results.

View our latest analysis for AcrelLtd

Taking into account the latest results, the most recent consensus for AcrelLtd from three analysts is for revenues of CN¥1.37b in 2024. If met, it would imply a sizeable 23% increase on its revenue over the past 12 months. Per-share earnings are expected to surge 28% to CN¥1.22. In the lead-up to this report, the analysts had been modelling revenues of CN¥1.67b and earnings per share (EPS) of CN¥1.54 in 2024. Indeed, we can see that the analysts are a lot more bearish about AcrelLtd's prospects following the latest results, administering a substantial drop in revenue estimates and slashing their EPS estimates to boot.

It'll come as no surprise then, to learn that the analysts have cut their price target 11% to CN¥30.92. 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 AcrelLtd analyst has a price target of CN¥32.24 per share, while the most pessimistic values it at CN¥29.60. The narrow spread of estimates could suggest that the business' future is relatively easy to value, or thatthe analysts have a strong view on its prospects.

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 analysts are definitely expecting AcrelLtd's growth to accelerate, with the forecast 23% annualised growth to the end of 2024 ranking favourably alongside historical growth of 18% per annum over the past five years. Other similar companies in the industry (with analyst coverage) are also forecast to grow their revenue at 18% per year. Factoring in the forecast acceleration in revenue, it's pretty clear that AcrelLtd is expected to grow at about the same rate as the wider industry.

The Bottom Line

The biggest concern is that the analysts reduced their earnings per share estimates, suggesting business headwinds could lay ahead for AcrelLtd. 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 fell measurably, with the analysts seemingly not reassured by the latest results, leading to a lower estimate of AcrelLtd's future valuation.

With that said, the long-term trajectory of the company's earnings is a lot more important than next year. We have forecasts for AcrelLtd going out to 2026, and you can see them free on our platform here.

We don't want to rain on the parade too much, but we did also find 2 warning signs for AcrelLtd that you need to be mindful 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.