Earnings Report: Jiangsu Changqing Agrochemical Co., Ltd. Missed Revenue Estimates By 19%

Shareholders might have noticed that Jiangsu Changqing Agrochemical Co., Ltd. (SZSE:002391) filed its quarterly result this time last week. The early response was not positive, with shares down 9.9% to CN¥4.90 in the past week. Revenues were CN¥860m, 19% below analyst expectations, although losses didn't appear to worsen significantly, with a statutory per-share loss of CN¥0.11 being in line with what the analysts anticipated. Earnings are an important time for investors, as they can track a company's performance, look at what the analysts are forecasting for next year, and see if there's been a change in sentiment towards the company. We've gathered the most recent statutory forecasts to see whether the analysts have changed their earnings models, following these results.

View our latest analysis for Jiangsu Changqing Agrochemical

Following the latest results, Jiangsu Changqing Agrochemical's three analysts are now forecasting revenues of CN¥4.08b in 2024. This would be a decent 18% improvement in revenue compared to the last 12 months. Jiangsu Changqing Agrochemical is also expected to turn profitable, with statutory earnings of CN¥0.18 per share. Before this earnings report, the analysts had been forecasting revenues of CN¥5.35b and earnings per share (EPS) of CN¥0.57 in 2024. It looks like sentiment has declined substantially in the aftermath of these results, with a large cut to revenue estimates and a large cut to earnings per share numbers as well.

It'll come as no surprise then, to learn that the analysts have cut their price target 36% to CN¥6.30.

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Jiangsu Changqing Agrochemical's past performance and to peers in the same industry. The analysts are definitely expecting Jiangsu Changqing Agrochemical's growth to accelerate, with the forecast 25% annualised growth to the end of 2024 ranking favourably alongside historical growth of 5.5% per annum 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 Changqing Agrochemical is expected to grow much faster than its industry.

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. Regrettably, they also downgraded their revenue estimates, but the latest forecasts still imply the business will grow faster than the wider industry. The consensus price target fell measurably, with the analysts seemingly not reassured by the latest results, leading to a lower estimate of Jiangsu Changqing Agrochemical's future valuation.

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 Jiangsu Changqing Agrochemical going out to 2026, and you can see them free on our platform here..

Even so, be aware that Jiangsu Changqing Agrochemical is showing 2 warning signs in our investment analysis , and 1 of those is significant...

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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.