CIMC Vehicles (Group) Co., Ltd. Just Missed EPS By 19%: Here's What Analysts Think Will Happen Next

The analysts might have been a bit too bullish on CIMC Vehicles (Group) Co., Ltd. (SZSE:301039), given that the company fell short of expectations when it released its yearly results last week. It wasn't a great result overall - while revenue fell marginally short of analyst estimates at CN¥21b, statutory earnings missed forecasts by 19%, coming in at just CN¥0.56 per share. 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. We thought readers would find it interesting to see the analysts latest (statutory) post-earnings forecasts for next year.

The end of cancer? These 15 emerging AI stocks are developing tech that will allow early identification of life changing diseases like cancer and Alzheimer's.

Taking into account the latest results, the current consensus from CIMC Vehicles (Group)'s five analysts is for revenues of CN¥24.0b in 2025. This would reflect a meaningful 14% increase on its revenue over the past 12 months. Statutory earnings per share are predicted to shoot up 44% to CN¥0.83. Before this earnings report, the analysts had been forecasting revenues of CN¥27.2b and earnings per share (EPS) of CN¥0.86 in 2025. Indeed, we can see that sentiment has declined measurably after results came out, with a substantial drop in revenue estimates and a small dip in EPS estimates to boot.

See our latest analysis for CIMC Vehicles (Group)

The analysts made no major changes to their price target of CN¥12.44, suggesting the downgrades are not expected to have a long-term impact on CIMC Vehicles (Group)'s valuation. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. Currently, the most bullish analyst values CIMC Vehicles (Group) at CN¥15.00 per share, while the most bearish prices it at CN¥10.80. This shows there is still a bit of diversity in estimates, but analysts don't appear to be totally split on the stock as though it might be a success or failure situation.

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the CIMC Vehicles (Group)'s past performance and to peers in the same industry. One thing stands out from these estimates, which is that CIMC Vehicles (Group) is forecast to grow faster in the future than it has in the past, with revenues expected to display 14% annualised growth until the end of 2025. If achieved, this would be a much better result than the 2.1% annual decline over the past five years. Compare this against analyst estimates for the broader industry, which suggest that (in aggregate) industry revenues are expected to grow 16% annually. So while CIMC Vehicles (Group)'s revenues are expected to improve, it seems that it is expected to grow at about the same rate as the overall 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¥12.44, 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. We have estimates - from multiple CIMC Vehicles (Group) analysts - going out to 2027, and you can see them free on our platform here.

However, before you get too enthused, we've discovered 2 warning signs for CIMC Vehicles (Group) 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.