Need To Know: The Consensus Just Cut Its SDIC Capital Co.,Ltd (SHSE:600061) Estimates For 2024

Market forces rained on the parade of SDIC Capital Co.,Ltd (SHSE:600061) shareholders today, when the analysts downgraded their forecasts for this year. This report focused on revenue estimates, and it looks as though the consensus view of the business has become substantially more conservative.

Following the downgrade, the most recent consensus for SDIC CapitalLtd from its three analysts is for revenues of CN¥16b in 2024 which, if met, would be a huge 35% increase on its sales over the past 12 months. Before the latest update, the analysts were foreseeing CN¥17b of revenue in 2024. It looks like forecasts have become a fair bit less optimistic on SDIC CapitalLtd, given the substantial drop in revenue estimates.

Check out our latest analysis for SDIC CapitalLtd

There was no particular change to the consensus price target of CN¥7.34, with SDIC CapitalLtd's latest outlook seemingly not enough to result in a change of valuation.

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. It's clear from the latest estimates that SDIC CapitalLtd's rate of growth is expected to accelerate meaningfully, with the forecast 35% annualised revenue growth to the end of 2024 noticeably faster than its historical growth of 9.9% p.a. 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 10.0% per year. Factoring in the forecast acceleration in revenue, it's pretty clear that SDIC CapitalLtd is expected to grow much faster than its industry.

The Bottom Line

The clear low-light was that analysts slashing their revenue forecasts for SDIC CapitalLtd this year. The analysts also expect revenues to grow faster than the wider market. Given the stark change in sentiment, we'd understand if investors became more cautious on SDIC CapitalLtd after today.

After a downgrade like this, it's pretty clear that previous forecasts were too optimistic. What's more, we've spotted several possible issues with SDIC CapitalLtd's business, like concerns around earnings quality. Learn more, and discover the 1 other flag we've identified, for 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 with high insider ownership.

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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.