Qingdao Richen Food Co.,Ltd. Earnings Missed Analyst Estimates: Here's What Analysts Are Forecasting Now

As you might know, Qingdao Richen Food Co.,Ltd. (SHSE:603755) last week released its latest annual, and things did not turn out so great for shareholders. Results look to have been somewhat negative - revenue fell 5.0% short of analyst estimates at CN¥359m, and statutory earnings of CN¥0.57 per share missed forecasts by 6.7%. Earnings are an important time for investors, as they can track a company's performance, look at what the analysts are forecasting for next year, and see if there's been a change in sentiment towards the company. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether the analysts have changed their mind on Qingdao Richen FoodLtd after the latest results.

Check out our latest analysis for Qingdao Richen FoodLtd

Following the latest results, Qingdao Richen FoodLtd's three analysts are now forecasting revenues of CN¥449.6m in 2024. This would be a sizeable 25% improvement in revenue compared to the last 12 months. Statutory earnings per share are predicted to bounce 31% to CN¥0.75. Yet prior to the latest earnings, the analysts had been anticipated revenues of CN¥480.3m and earnings per share (EPS) of CN¥0.85 in 2024. The analysts seem less optimistic after the recent results, reducing their revenue forecasts and making a substantial drop in earnings per share numbers.

The consensus price target fell 50% to CN¥25.00, with the weaker earnings outlook clearly leading valuation estimates.

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 Qingdao Richen FoodLtd's rate of growth is expected to accelerate meaningfully, with the forecast 25% annualised revenue growth to the end of 2024 noticeably faster than its historical growth of 6.7% p.a. over the past five years. Compare this with other companies in the same industry, which are forecast to grow their revenue 13% annually. Factoring in the forecast acceleration in revenue, it's pretty clear that Qingdao Richen FoodLtd is expected to grow much faster than its 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 Qingdao Richen FoodLtd's revenue estimates, but industry data suggests that it is expected to grow faster than the wider industry. 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 Qingdao Richen FoodLtd. Long-term earnings power is much more important than next year's profits. We have forecasts for Qingdao Richen FoodLtd going out to 2026, and you can see them free on our platform here.

Plus, you should also learn about the 1 warning sign we've spotted with Qingdao Richen FoodLtd .

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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.