Guangzhou Holike Creative Home Co.,Ltd. (SHSE:603898) Analysts Just Trimmed Their Revenue Forecasts By 12%

The latest analyst coverage could presage a bad day for Guangzhou Holike Creative Home Co.,Ltd. (SHSE:603898), with the analysts making across-the-board cuts to their statutory estimates that might leave shareholders a little shell-shocked. Revenue estimates were cut sharply as analysts signalled a weaker outlook - perhaps a sign that investors should temper their expectations as well.

After the downgrade, the four analysts covering Guangzhou Holike Creative HomeLtd are now predicting revenues of CN¥2.5b in 2024. If met, this would reflect a credible 6.7% improvement in sales compared to the last 12 months. Per-share earnings are expected to expand 12% to CN¥0.79. Prior to this update, the analysts had been forecasting revenues of CN¥2.8b and earnings per share (EPS) of CN¥0.78 in 2024. Indeed we can see that the consensus opinion has undergone some fundamental changes following the recent consensus updates, with a measurable cut to revenues and some minor tweaks to earnings numbers.

View our latest analysis for Guangzhou Holike Creative HomeLtd

Of course, another way to look at these forecasts is to place them into context against the industry itself. The analysts are definitely expecting Guangzhou Holike Creative HomeLtd's growth to accelerate, with the forecast 6.7% annualised growth to the end of 2024 ranking favourably alongside historical growth of 4.3% per annum over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to grow their revenue at 9.3% per year. So it's clear that despite the acceleration in growth, Guangzhou Holike Creative HomeLtd is expected to grow meaningfully slower than the industry average.

The Bottom Line

The most important thing to take away is that there's been no major change in sentiment, with analysts reconfirming that earnings per share are expected to continue performing in line with their prior expectations. Unfortunately analysts also downgraded their revenue estimates, and industry data suggests that Guangzhou Holike Creative HomeLtd's revenues are expected to grow slower than the wider market. Overall, given the drastic downgrade to this year's forecasts, we'd be feeling a little more wary of Guangzhou Holike Creative HomeLtd going forwards.

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 Guangzhou Holike Creative HomeLtd going out to 2026, and you can see them free on our platform here.

Of course, seeing company management invest large sums of money in a stock can be just as useful as knowing whether analysts are downgrading their estimates. So you may also wish to search this free list of stocks that insiders are buying.

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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.