Downgrade: Here's How Analysts See Juewei Food Co., Ltd. (SHSE:603517) Performing In The Near Term

Today is shaping up negative for Juewei Food Co., Ltd. (SHSE:603517) shareholders, with the analysts delivering a substantial negative revision to this year's forecasts. Both revenue and earnings per share (EPS) forecasts went under the knife, suggesting analysts have soured majorly on the business. The stock price has risen 7.1% to CN¥20.31 over the past week. Investors could be forgiven for changing their mind on the business following the downgrade; but it's not clear if the revised forecasts will lead to selling activity.

Following the downgrade, the latest consensus from Juewei Food's 16 analysts is for revenues of CN¥7.6b in 2024, which would reflect a modest 6.8% improvement in sales compared to the last 12 months. Per-share earnings are expected to surge 87% to CN¥1.12. Previously, the analysts had been modelling revenues of CN¥8.6b and earnings per share (EPS) of CN¥1.48 in 2024. It looks like analyst sentiment has declined substantially, with a measurable cut to revenue estimates and a large cut to earnings per share numbers as well.

See our latest analysis for Juewei Food

It'll come as no surprise then, to learn that the analysts have cut their price target 25% to CN¥24.49.

Of course, another way to look at these forecasts is to place them into context against the industry itself. The period to the end of 2024 brings more of the same, according to the analysts, with revenue forecast to display 9.1% growth on an annualised basis. That is in line with its 9.4% annual growth over the past five years. Compare this with the broader industry, which analyst estimates (in aggregate) suggest will see revenues grow 9.2% annually. So although Juewei Food is expected to maintain its revenue growth rate, it's only growing at about the rate of the wider industry.

The Bottom Line

The biggest issue in the new estimates is that analysts have reduced their earnings per share estimates, suggesting business headwinds lay ahead for Juewei Food. Lamentably, they also downgraded their sales forecasts, but the business is still expected to grow at roughly the same rate as the market itself. After such a stark change in sentiment from analysts, we'd understand if readers now felt a bit wary of Juewei Food.

Even so, the longer term trajectory of the business is much more important for the value creation of shareholders. We have estimates - from multiple Juewei Food analysts - going out to 2026, and you can see them 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 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.