Hangzhou Robam Appliances Co., Ltd. Just Missed Revenue By 6.1%: Here's What Analysts Think Will Happen Next

Hangzhou Robam Appliances Co., Ltd. (SZSE:002508) missed earnings with its latest first-quarter results, disappointing overly-optimistic forecasters. Hangzhou Robam Appliances missed analyst forecasts, with revenues of CN¥2.2b and statutory earnings per share (EPS) of CN¥0.42, falling short by 6.1% and 2.3% respectively. Following the result, the analysts have updated their earnings model, and it would be good to know whether they think there's been a strong change in the company's prospects, or if it's business as usual. We've gathered the most recent statutory forecasts to see whether the analysts have changed their earnings models, following these results.

View our latest analysis for Hangzhou Robam Appliances

Taking into account the latest results, the current consensus from Hangzhou Robam Appliances' 21 analysts is for revenues of CN¥12.1b in 2024. This would reflect a reasonable 7.7% increase on its revenue over the past 12 months. Per-share earnings are expected to increase 9.5% to CN¥2.02. In the lead-up to this report, the analysts had been modelling revenues of CN¥12.4b and earnings per share (EPS) of CN¥2.20 in 2024. So it looks like there's been a small decline in overall sentiment after the recent results - there's been no major change to revenue estimates, but the analysts did make a minor downgrade to their earnings per share forecasts.

The consensus price target held steady at CN¥28.56, with the analysts seemingly voting that their lower forecast earnings are not expected to lead to a lower stock price in the foreseeable future. That's not the only conclusion we can draw from this data however, as some investors also like to consider the spread in estimates when evaluating analyst price targets. There are some variant perceptions on Hangzhou Robam Appliances, with the most bullish analyst valuing it at CN¥38.00 and the most bearish at CN¥23.00 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.

Looking at the bigger picture now, one of the ways we can make sense of these forecasts is to see how they measure up against both past performance and industry growth estimates. We can infer from the latest estimates that forecasts expect a continuation of Hangzhou Robam Appliances'historical trends, as the 10% annualised revenue growth to the end of 2024 is roughly in line with the 9.6% annual growth over the past five years. Juxtapose this against our data, which suggests that other companies (with analyst coverage) in the industry are forecast to see their revenues grow 9.6% per year. It's clear that while Hangzhou Robam Appliances' revenue growth is expected to continue on its current trajectory, it's only expected to grow in line with the industry itself.

The Bottom Line

The biggest concern is that the analysts reduced their earnings per share estimates, suggesting business headwinds could lay ahead for Hangzhou Robam Appliances. Happily, there were no real changes to revenue forecasts, with the business still expected to grow in line with the overall 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. We have forecasts for Hangzhou Robam Appliances going out to 2026, and you can see them free on our platform here.

You still need to take note of risks, for example - Hangzhou Robam Appliances 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.