Science Environmental Protection Co., Ltd. Just Beat Earnings Expectations: Here's What Analysts Think Will Happen Next

Shareholders of Science Environmental Protection Co., Ltd. (SHSE:688480) will be pleased this week, given that the stock price is up 15% to CN¥34.74 following its latest full-year results. Revenues were CN¥808m, approximately in line with expectations, although statutory earnings per share (EPS) performed substantially better. EPS of CN¥0.98 were also better than expected, beating analyst predictions by 10%. Earnings are an important time for investors, as they can track a company's performance, look at what the analyst is forecasting for next year, and see if there's been a change in sentiment towards the company. We thought readers would find it interesting to see the analyst latest (statutory) post-earnings forecasts for next year.

Check out our latest analysis for Science Environmental Protection

Taking into account the latest results, the consensus forecast from Science Environmental Protection's sole analyst is for revenues of CN¥1.37b in 2024. This reflects a substantial 70% improvement in revenue compared to the last 12 months. Per-share earnings are expected to surge 123% to CN¥2.12. In the lead-up to this report, the analyst had been modelling revenues of CN¥1.29b and earnings per share (EPS) of CN¥1.68 in 2024. So it seems there's been a definite increase in optimism about Science Environmental Protection's future following the latest results, with a massive increase in the earnings per share forecasts in particular.

Despite these upgrades,the analyst has not made any major changes to their price target of CN¥46.64, suggesting that the higher estimates are not likely to have a long term impact on what the stock 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. The analyst is definitely expecting Science Environmental Protection's growth to accelerate, with the forecast 70% annualised growth to the end of 2024 ranking favourably alongside historical growth of 15% per annum over the past five years. Compare this with other companies in the same industry, which are forecast to grow their revenue 19% annually. Factoring in the forecast acceleration in revenue, it's pretty clear that Science Environmental Protection is expected to grow much faster than its industry.

The Bottom Line

The biggest takeaway for us is the consensus earnings per share upgrade, which suggests a clear improvement in sentiment around Science Environmental Protection's earnings potential next year. Pleasantly, they also upgraded their revenue estimates, and their forecasts suggest the business is expected to grow faster than the wider industry. There was no real change to the consensus price target, suggesting that the intrinsic value of the business has not undergone any major changes with the latest estimates.

Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. At least one analyst has provided forecasts out to 2026, which can be seen for free on our platform here.

You still need to take note of risks, for example - Science Environmental Protection has 1 warning sign we think you should be aware 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.