Earnings Release: Here's Why Analysts Cut Their YONFER Agricultural Technology Co., Ltd. (SZSE:000902) Price Target To CN¥14.90

YONFER Agricultural Technology Co., Ltd. (SZSE:000902) missed earnings with its latest yearly results, disappointing overly-optimistic forecasters. Results look to have been somewhat negative - revenue fell 4.2% short of analyst estimates at CN¥15b, and statutory earnings of CN¥0.99 per share missed forecasts by 3.6%. This is an important time for investors, as they can track a company's performance in its report, look at what experts are forecasting for next year, and see if there has been any change to expectations for the business. We thought readers would find it interesting to see the analysts latest (statutory) post-earnings forecasts for next year.

View our latest analysis for YONFER Agricultural Technology

After the latest results, the six analysts covering YONFER Agricultural Technology are now predicting revenues of CN¥17.3b in 2024. If met, this would reflect a solid 15% improvement in revenue compared to the last 12 months. Per-share earnings are expected to ascend 18% to CN¥1.13. In the lead-up to this report, the analysts had been modelling revenues of CN¥16.7b and earnings per share (EPS) of CN¥1.23 in 2024. Overall it looks as though the analysts were a bit mixed on the latest results. Although there was a a solid to revenue, the consensus also made a minor downgrade to its earnings per share forecasts.

The consensus price target fell 5.9% to CN¥14.90, suggesting that the analysts are primarily focused on earnings as the driver of value for this business. 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 YONFER Agricultural Technology analyst has a price target of CN¥17.00 per share, while the most pessimistic values it at CN¥13.50. Even so, with a relatively close grouping of estimates, it looks like the analysts are quite confident in their valuations, suggesting YONFER Agricultural Technology is an easy business to forecast or the the analysts are all using similar assumptions.

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 YONFER Agricultural Technology's rate of growth is expected to accelerate meaningfully, with the forecast 15% annualised revenue growth to the end of 2024 noticeably faster than its historical growth of 12% p.a. over the past five years. Other similar companies in the industry (with analyst coverage) are also forecast to grow their revenue at 16% per year. YONFER Agricultural Technology is expected to grow at about the same rate as its industry, so it's not clear that we can draw any conclusions from its growth relative to competitors.

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. There was also an upgrade to revenue estimates, although as we saw earlier, forecast growth is only expected to be about the same as 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 said, the long-term trajectory of the company's earnings is a lot more important than next year. We have estimates - from multiple YONFER Agricultural Technology analysts - going out to 2026, and you can see them free on our platform here.

Don't forget that there may still be risks. For instance, we've identified 1 warning sign for YONFER Agricultural Technology that you should be aware of.

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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.