The Consensus EPS Estimates For Sunrise Manufacture Group Co., Ltd. (SHSE:605138) Just Fell Dramatically

The latest analyst coverage could presage a bad day for Sunrise Manufacture Group Co., Ltd. (SHSE:605138), with the analysts making across-the-board cuts to their statutory estimates that might leave shareholders a little shell-shocked. Both revenue and earnings per share (EPS) forecasts went under the knife, suggesting analysts have soured majorly on the business. Shares are up 6.2% to CN¥6.31 in the past week. It will be interesting to see if this downgrade motivates investors to start selling their holdings.

After this downgrade, Sunrise Manufacture Group's three analysts are now forecasting revenues of CN¥5.0b in 2024. This would be a notable 16% improvement in sales compared to the last 12 months. Per-share earnings are expected to bounce 381% to CN¥0.47. Prior to this update, the analysts had been forecasting revenues of CN¥6.3b and earnings per share (EPS) of CN¥0.56 in 2024. It looks like analyst sentiment has declined substantially, with a sizeable cut to revenue estimates and a considerable drop in earnings per share numbers as well.

See our latest analysis for Sunrise Manufacture Group

The consensus price target fell 22% to CN¥7.20, with the weaker earnings outlook clearly leading analyst valuation estimates.

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Sunrise Manufacture Group's past performance and to peers in the same industry. It's clear from the latest estimates that Sunrise Manufacture Group's rate of growth is expected to accelerate meaningfully, with the forecast 16% annualised revenue growth to the end of 2024 noticeably faster than its historical growth of 1.1% p.a. over the past three years. Other similar companies in the industry (with analyst coverage) are also forecast to grow their revenue at 14% per year. Sunrise Manufacture Group is expected to grow at about the same rate as its industry, so it's not clear that we can draw any conclusions from its growth relative to competitors.

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. There was also a drop in their revenue estimates, although as we saw earlier, forecast growth is only expected to be about the same as the wider market. With a serious cut to this year's expectations and a falling price target, we wouldn't be surprised if investors were becoming wary of Sunrise Manufacture Group.

So things certainly aren't looking great, and you should also know that we've spotted some potential warning signs with Sunrise Manufacture Group, including the risk of cutting its dividend. For more information, you can click here to discover this and the 3 other flags we've identified.

Another way to search for interesting companies that could be reaching an inflection point is to track whether management are buying or selling, with our free list of growing companies 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.