Time To Worry? Analysts Are Downgrading Their Gansu Shangfeng Cement Co.,Ltd (SZSE:000672) Outlook

The analysts covering Gansu Shangfeng Cement Co.,Ltd (SZSE:000672) delivered a dose of negativity to shareholders today, by making a substantial revision to their statutory forecasts for this year. Revenue and earnings per share (EPS) forecasts were both revised downwards, with analysts seeing grey clouds on the horizon.

Following the downgrade, the consensus from three analysts covering Gansu Shangfeng CementLtd is for revenues of CN¥6.4b in 2024, implying a measurable 6.9% decline in sales compared to the last 12 months. Statutory earnings per share are supposed to dip 9.5% to CN¥0.76 in the same period. Before this latest update, the analysts had been forecasting revenues of CN¥7.1b and earnings per share (EPS) of CN¥1.01 in 2024. Indeed, we can see that the analysts are a lot more bearish about Gansu Shangfeng CementLtd's prospects, administering a measurable cut to revenue estimates and slashing their EPS estimates to boot.

View our latest analysis for Gansu Shangfeng CementLtd

It'll come as no surprise then, to learn that the analysts have cut their price target 8.8% to CN¥10.30.

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Gansu Shangfeng CementLtd's past performance and to peers in the same industry. We would highlight that sales are expected to reverse, with a forecast 6.9% annualised revenue decline to the end of 2024. That is a notable change from historical growth of 5.2% over the last five years. By contrast, our data suggests that other companies (with analyst coverage) in the same industry are forecast to see their revenue grow 7.9% annually for the foreseeable future. So although its revenues are forecast to shrink, this cloud does not come with a silver lining - Gansu Shangfeng CementLtd is expected to lag 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 Gansu Shangfeng CementLtd. Regrettably, they also downgraded their revenue estimates, and the latest forecasts imply the business will grow sales slower than the wider market. Given the scope of the downgrades, it would not be a surprise to see the market become more wary of the business.

With that said, the long-term trajectory of the company's earnings is a lot more important than next year. We have estimates - from multiple Gansu Shangfeng CementLtd analysts - going out to 2025, 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.