Here's What Analysts Are Forecasting For Tayho Advanced Materials Group Co., Ltd. (SZSE:002254) Following Its Earnings Miss

The analysts might have been a bit too bullish on Tayho Advanced Materials Group Co., Ltd. (SZSE:002254), given that the company fell short of expectations when it released its yearly results last week. It looks like a clear earnings miss, with both revenues and earnings falling well short of analyst predictions. Revenues of CN¥3.9b missed by 12%, and statutory earnings per share of CN¥0.40 fell short of forecasts by 14%. This is an important time for investors, as they can track a company's performance in its report, look at what experts are forecasting for next year, and see if there has been any change to expectations for the business. So we collected the latest post-earnings statutory consensus estimates to see what could be in store for next year.

See our latest analysis for Tayho Advanced Materials Group

Taking into account the latest results, the most recent consensus for Tayho Advanced Materials Group from four analysts is for revenues of CN¥5.66b in 2024. If met, it would imply a substantial 44% increase on its revenue over the past 12 months. Statutory earnings per share are predicted to bounce 36% to CN¥0.53. Yet prior to the latest earnings, the analysts had been anticipated revenues of CN¥5.85b and earnings per share (EPS) of CN¥0.75 in 2024. From this we can that sentiment has definitely become more bearish after the latest results, leading to lower revenue forecasts and a large cut to earnings per share estimates.

The consensus price target fell 17% to CN¥17.00, with the weaker earnings outlook clearly leading valuation estimates. There's another way to think about price targets though, and that's to look at the range of price targets put forward by analysts, because a wide range of estimates could suggest a diverse view on possible outcomes for the business. There are some variant perceptions on Tayho Advanced Materials Group, with the most bullish analyst valuing it at CN¥20.00 and the most bearish at CN¥14.00 per share. 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.

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 analysts are definitely expecting Tayho Advanced Materials Group's growth to accelerate, with the forecast 44% annualised growth to the end of 2024 ranking favourably alongside historical growth of 13% 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 14% per year. It seems obvious that, while the growth outlook is brighter than the recent past, the analysts also expect Tayho Advanced Materials Group to grow faster than the wider 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 Tayho Advanced Materials Group's revenue estimates, but industry data suggests that it is expected to grow faster than 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 Tayho Advanced Materials Group's future valuation.

With that in mind, we wouldn't be too quick to come to a conclusion on Tayho Advanced Materials Group. Long-term earnings power is much more important than next year's profits. We have forecasts for Tayho Advanced Materials Group going out to 2026, and you can see them free on our platform here.

Before you take the next step you should know about the 2 warning signs for Tayho Advanced Materials Group (1 is significant!) that we have uncovered.

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.