Revenue Miss: Anhui Jinhe Industrial Co.,Ltd. Fell 28% Short Of Analyst Revenue Estimates And Analysts Have Been Revising Their Models

It's been a pretty great week for Anhui Jinhe Industrial Co.,Ltd. (SZSE:002597) shareholders, with its shares surging 14% to CN¥24.61 in the week since its latest quarterly results. Revenues were CN¥1.2b, 28% shy of what the analysts were expecting, although statutory earnings of CN¥1.27 per share were roughly in line with what was forecast. 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. So we collected the latest post-earnings statutory consensus estimates to see what could be in store for next year.

View our latest analysis for Anhui Jinhe IndustrialLtd

Following the latest results, Anhui Jinhe IndustrialLtd's nine analysts are now forecasting revenues of CN¥5.27b in 2024. This would be an okay 2.4% improvement in revenue compared to the last 12 months. Statutory earnings per share are predicted to bounce 29% to CN¥1.35. Yet prior to the latest earnings, the analysts had been anticipated revenues of CN¥5.33b and earnings per share (EPS) of CN¥1.41 in 2024. The analysts seem to have become a little more negative on the business after the latest results, given the minor downgrade to their earnings per share numbers for next year.

It might be a surprise to learn that the consensus price target was broadly unchanged at CN¥26.59, with the analysts clearly implying that the forecast decline in earnings is not expected to have much of an impact on valuation. Fixating on a single price target can be unwise though, since the consensus target is effectively the average of analyst price targets. As a result, some investors like to look at the range of estimates to see if there are any diverging opinions on the company's valuation. The most optimistic Anhui Jinhe IndustrialLtd analyst has a price target of CN¥28.00 per share, while the most pessimistic values it at CN¥25.50. The narrow spread of estimates could suggest that the business' future is relatively easy to value, or thatthe analysts have a strong view on its prospects.

Looking at the bigger picture now, one of the ways we can make sense of these forecasts is to see how they measure up against both past performance and industry growth estimates. We would highlight that Anhui Jinhe IndustrialLtd's revenue growth is expected to slow, with the forecast 3.2% annualised growth rate until the end of 2024 being well below the historical 13% 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 16% per year. Factoring in the forecast slowdown in growth, it seems obvious that Anhui Jinhe IndustrialLtd is also expected to grow slower than other industry participants.

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. Fortunately, the analysts also reconfirmed their revenue estimates, suggesting that it's tracking in line with expectations. Although our data does suggest that Anhui Jinhe IndustrialLtd's revenue is expected to perform worse than the wider industry. The consensus price target held steady at CN¥26.59, with the latest estimates not enough to have an impact on their price targets.

With that said, the long-term trajectory of the company's earnings is a lot more important than next year. We have forecasts for Anhui Jinhe IndustrialLtd going out to 2026, and you can see them free on our platform here.

Even so, be aware that Anhui Jinhe IndustrialLtd is showing 2 warning signs in our investment analysis , you should know about...

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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.