Ligao Foods Co.,Ltd. Just Missed Earnings - But Analysts Have Updated Their Models

As you might know, Ligao Foods Co.,Ltd. (SZSE:300973) last week released its latest quarterly, and things did not turn out so great for shareholders. Results look to have been somewhat negative - revenue fell 2.1% short of analyst estimates at CN¥865m, and statutory earnings of CN¥0.36 per share missed forecasts by 8.4%. 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. 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 Ligao FoodsLtd

Taking into account the latest results, the current consensus from Ligao FoodsLtd's nine analysts is for revenues of CN¥3.88b in 2024. This would reflect a satisfactory 6.5% increase on its revenue over the past 12 months. Statutory earnings per share are predicted to jump 169% to CN¥1.60. Yet prior to the latest earnings, the analysts had been anticipated revenues of CN¥4.09b and earnings per share (EPS) of CN¥1.69 in 2024. It's pretty clear that pessimism has reared its head after the latest results, leading to a weaker revenue outlook and a minor downgrade to earnings per share estimates.

The analysts made no major changes to their price target of CN¥41.16, suggesting the downgrades are not expected to have a long-term impact on Ligao FoodsLtd's valuation. The consensus price target is just an average of individual analyst targets, so - it could be handy to see how wide the range of underlying estimates is. The most optimistic Ligao FoodsLtd analyst has a price target of CN¥46.50 per share, while the most pessimistic values it at CN¥32.00. Analysts definitely have varying views on the business, but the spread of estimates is not wide enough in our view to suggest that extreme outcomes could await Ligao FoodsLtd shareholders.

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. The period to the end of 2024 brings more of the same, according to the analysts, with revenue forecast to display 13% growth on an annualised basis. That is in line with its 13% annual growth over the past three years. Compare this with the broader industry, which analyst estimates (in aggregate) suggest will see revenues grow 11% annually. So although Ligao FoodsLtd 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 concern is that the analysts reduced their earnings per share estimates, suggesting business headwinds could lay ahead for Ligao FoodsLtd. Sadly, they also downgraded their revenue forecasts, but the business is still expected to grow at roughly the same rate as the industry itself. 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.

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

And what about risks? Every company has them, and we've spotted 2 warning signs for Ligao FoodsLtd you should know about.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

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.