Earnings Report: Anhui Huaheng Biotechnology Co., Ltd. Missed Revenue Estimates By 37%

As you might know, Anhui Huaheng Biotechnology Co., Ltd. (SHSE:688639) last week released its latest first-quarter, and things did not turn out so great for shareholders. The analysts look to have been far too optimistic in the lead-up to these results, with revenues of (CN¥501m) coming in 37% below what they had expected. Statutory earnings per share of CN¥0.55 fell 30% short. 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. We thought readers would find it interesting to see the analysts latest (statutory) post-earnings forecasts for next year.

See our latest analysis for Anhui Huaheng Biotechnology

Taking into account the latest results, the consensus forecast from Anhui Huaheng Biotechnology's eight analysts is for revenues of CN¥3.15b in 2024. This reflects a huge 54% improvement in revenue compared to the last 12 months. Statutory earnings per share are predicted to surge 34% to CN¥3.87. Before this earnings report, the analysts had been forecasting revenues of CN¥3.18b and earnings per share (EPS) of CN¥4.02 in 2024. So it looks like there's been a small decline in overall sentiment after the recent results - there's been no major change to revenue estimates, but the analysts did make a small dip in their earnings per share forecasts.

The consensus price target held steady at CN¥135, with the analysts seemingly voting that their lower forecast earnings are not expected to lead to a lower stock price in the foreseeable future. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. There are some variant perceptions on Anhui Huaheng Biotechnology, with the most bullish analyst valuing it at CN¥140 and the most bearish at CN¥126 per share. With such a narrow range of valuations, the analysts apparently share similar views on what they think the business is worth.

One way to get more context on these forecasts is to look at how they compare to both past performance, and how other companies in the same industry are performing. It's clear from the latest estimates that Anhui Huaheng Biotechnology's rate of growth is expected to accelerate meaningfully, with the forecast 78% annualised revenue growth to the end of 2024 noticeably faster than its historical growth of 39% p.a. over the past three years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to grow their revenue at 16% per year. It seems obvious that, while the growth outlook is brighter than the recent past, the analysts also expect Anhui Huaheng Biotechnology to grow faster than 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 Anhui Huaheng Biotechnology. Happily, there were no major changes to revenue forecasts, with the business still expected to grow faster than the wider industry. The consensus price target held steady at CN¥135, with the latest estimates not enough to have an impact on their price targets.

Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. At Simply Wall St, we have a full range of analyst estimates for Anhui Huaheng Biotechnology going out to 2026, and you can see them free on our platform here..

Before you take the next step you should know about the 2 warning signs for Anhui Huaheng Biotechnology that we have uncovered.

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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.