Downgrade: Here's How Analysts See Jiangsu Cnano Technology Co., Ltd. (SHSE:688116) Performing In The Near Term

Market forces rained on the parade of Jiangsu Cnano Technology Co., Ltd. (SHSE:688116) shareholders today, when the analysts downgraded their forecasts for this year. Both revenue and earnings per share (EPS) forecasts went under the knife, suggesting analysts have soured majorly on the business.

Following the downgrade, the latest consensus from Jiangsu Cnano Technology's four analysts is for revenues of CN¥2.5b in 2025, which would reflect a huge 70% improvement in sales compared to the last 12 months. Statutory earnings per share are presumed to surge 69% to CN¥1.24. Before this latest update, the analysts had been forecasting revenues of CN¥2.8b and earnings per share (EPS) of CN¥1.63 in 2025. Indeed, we can see that the analysts are a lot more bearish about Jiangsu Cnano Technology's prospects, administering a measurable cut to revenue estimates and slashing their EPS estimates to boot.

Check out our latest analysis for Jiangsu Cnano Technology

What's most unexpected is that the consensus price target rose 21% to CN¥35.80, strongly implying the downgrade to forecasts is not expected to be more than a temporary blip.

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. It's clear from the latest estimates that Jiangsu Cnano Technology's rate of growth is expected to accelerate meaningfully, with the forecast 70% annualised revenue growth to the end of 2025 noticeably faster than its historical growth of 23% p.a. over the past five years. Compare this with other companies in the same industry, which are forecast to grow their revenue 16% annually. Factoring in the forecast acceleration in revenue, it's pretty clear that Jiangsu Cnano Technology is expected to grow much faster than its 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 Jiangsu Cnano Technology. Unfortunately, analysts also downgraded their revenue estimates, although our data indicates revenues are expected to perform better than the wider market. The increasing price target is not intuitively what we would expect to see, given these downgrades, and we'd suggest shareholders revisit their investment thesis before making a decision.

Even so, the longer term trajectory of the business is much more important for the value creation of shareholders. At Simply Wall St, we have a full range of analyst estimates for Jiangsu Cnano Technology going out to 2026, and you can see them free on our platform here.

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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.