Bearish: Analysts Just Cut Their Sinoma Science & Technology Co.,Ltd. (SZSE:002080) Revenue and EPS estimates

Market forces rained on the parade of Sinoma Science & Technology Co.,Ltd. (SZSE:002080) shareholders today, when the analysts downgraded their forecasts for this year. Revenue and earnings per share (EPS) forecasts were both revised downwards, with the analysts seeing grey clouds on the horizon.

Following the downgrade, the latest consensus from Sinoma Science & TechnologyLtd's eleven analysts is for revenues of CN¥25b in 2024, which would reflect a modest 2.6% improvement in sales compared to the last 12 months. Statutory earnings per share are presumed to rise 2.2% to CN¥0.79. Before this latest update, the analysts had been forecasting revenues of CN¥29b and earnings per share (EPS) of CN¥1.38 in 2024. Indeed, we can see that the analysts are a lot more bearish about Sinoma Science & TechnologyLtd's prospects, administering a measurable cut to revenue estimates and slashing their EPS estimates to boot.

View our latest analysis for Sinoma Science & TechnologyLtd

The consensus price target fell 35% to CN¥11.69, with the weaker earnings outlook clearly leading analyst valuation estimates.

Taking a look at the bigger picture now, one of the ways we can understand these forecasts is to see how they compare to both past performance and industry growth estimates. We would highlight that Sinoma Science & TechnologyLtd's revenue growth is expected to slow, with the forecast 5.2% annualised growth rate until the end of 2024 being well below the historical 14% p.a. growth over the last five years. By way of comparison, the other companies in this industry with analyst coverage are forecast to grow their revenue at 15% per year. So it's pretty clear that, while revenue growth is expected to slow down, the wider industry is also expected to grow faster than Sinoma Science & TechnologyLtd.

The Bottom Line

The most important thing to take away is that analysts cut their earnings per share estimates, expecting a clear decline in business conditions. Regrettably, they also downgraded their revenue estimates, and the latest forecasts imply the business will grow sales slower than the wider market. With a serious cut to this year's expectations and a falling price target, we wouldn't be surprised if investors were becoming wary of Sinoma Science & TechnologyLtd.

A high debt burden combined with a downgrade of this magnitude always gives us some reason for concern, especially if these forecasts are just the first sign of a business downturn. To see more of our financial analysis, you can click through to our free platform to learn more about its balance sheet and specific concerns we've identified.

We also provide an overview of the Sinoma Science & TechnologyLtd Board and CEO remuneration and length of tenure at the company, and whether insiders have been buying the stock, 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.