Qianhe Condiment and Food Co., Ltd. Earnings Missed Analyst Estimates: Here's What Analysts Are Forecasting Now

Qianhe Condiment and Food Co., Ltd. (SHSE:603027) missed earnings with its latest quarterly results, disappointing overly-optimistic forecasters. It wasn't a great result overall - while revenue fell marginally short of analyst estimates at CN¥694m, statutory earnings missed forecasts by 18%, coming in at just CN¥0.09 per share. The analysts typically update their forecasts at each earnings report, and we can judge from their estimates whether their view of the company has changed or if there are any new concerns to be aware of. With this in mind, we've gathered the latest statutory forecasts to see what the analysts are expecting for next year.

View our latest analysis for Qianhe Condiment and Food

After the latest results, the eight analysts covering Qianhe Condiment and Food are now predicting revenues of CN¥3.40b in 2024. If met, this would reflect a satisfactory 4.1% improvement in revenue compared to the last 12 months. Statutory earnings per share are predicted to rise 2.7% to CN¥0.52. Before this earnings report, the analysts had been forecasting revenues of CN¥3.72b and earnings per share (EPS) of CN¥0.63 in 2024. The analysts seem less optimistic after the recent results, reducing their revenue forecasts and making a real cut to earnings per share numbers.

The consensus price target fell 15% to CN¥16.56, with the weaker earnings outlook clearly leading valuation estimates. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. The most optimistic Qianhe Condiment and Food analyst has a price target of CN¥21.86 per share, while the most pessimistic values it at CN¥10.90. Note the wide gap in analyst price targets? This implies to us that there is a fairly broad range of possible scenarios for the underlying business.

Another way we can view these estimates is in the context of the bigger picture, such as how the forecasts stack up against past performance, and whether forecasts are more or less bullish relative to other companies in the industry. It's pretty clear that there is an expectation that Qianhe Condiment and Food's revenue growth will slow down substantially, with revenues to the end of 2024 expected to display 8.4% growth on an annualised basis. This is compared to a historical growth rate of 21% over the past five years. Compare this against other companies (with analyst forecasts) in the industry, which are in aggregate expected to see revenue growth of 11% annually. So it's pretty clear that, while revenue growth is expected to slow down, the wider industry is also expected to grow faster than Qianhe Condiment and Food.

The Bottom Line

The biggest concern is that the analysts reduced their earnings per share estimates, suggesting business headwinds could lay ahead for Qianhe Condiment and Food. Unfortunately, they also downgraded their revenue estimates, and our data indicates underperformance compared to the wider industry. Even so, earnings per share are more important to the intrinsic value of the business. Furthermore, the analysts also cut their price targets, suggesting that the latest news has led to greater pessimism about the intrinsic value of the business.

With that in mind, we wouldn't be too quick to come to a conclusion on Qianhe Condiment and Food. Long-term earnings power is much more important than next year's profits. We have estimates - from multiple Qianhe Condiment and Food analysts - going out to 2026, and you can see them free on our platform here.

However, before you get too enthused, we've discovered 1 warning sign for Qianhe Condiment and Food that 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.