Analysts Are More Bearish On Guangzhou Tinci Materials Technology Co., Ltd. (SZSE:002709) Than They Used To Be

The analysts covering Guangzhou Tinci Materials Technology Co., Ltd. (SZSE:002709) delivered a dose of negativity to shareholders today, by making a substantial revision to their statutory forecasts for this year. Both revenue and earnings per share (EPS) forecasts went under the knife, suggesting the analysts have soured majorly on the business. At CN¥22.23, shares are up 6.5% in the past 7 days. Investors could be forgiven for changing their mind on the business following the downgrade; but it's not clear if the revised forecasts will lead to selling activity.

After this downgrade, Guangzhou Tinci Materials Technology's 14 analysts are now forecasting revenues of CN¥16b in 2024. This would be an okay 5.4% improvement in sales compared to the last 12 months. Statutory earnings per share are supposed to sink 18% to CN¥0.81 in the same period. Before this latest update, the analysts had been forecasting revenues of CN¥20b and earnings per share (EPS) of CN¥1.51 in 2024. It looks like analyst sentiment has declined substantially, with a sizeable cut to revenue estimates and a large cut to earnings per share numbers as well.

View our latest analysis for Guangzhou Tinci Materials Technology

The consensus price target fell 8.3% to CN¥22.09, with the weaker earnings outlook clearly leading analyst valuation estimates.

Of course, another way to look at these forecasts is to place them into context against the industry itself. It's pretty clear that there is an expectation that Guangzhou Tinci Materials Technology's revenue growth will slow down substantially, with revenues to the end of 2024 expected to display 5.4% growth on an annualised basis. This is compared to a historical growth rate of 46% over the past five years. By way of comparison, the other companies in this industry with analyst coverage are forecast to grow their revenue at 17% per year. Factoring in the forecast slowdown in growth, it seems obvious that Guangzhou Tinci Materials Technology is also expected to grow slower than other industry participants.

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. After such a stark change in sentiment from analysts, we'd understand if readers now felt a bit wary of Guangzhou Tinci Materials Technology.

Still, the long-term prospects of the business are much more relevant than next year's earnings. At Simply Wall St, we have a full range of analyst estimates for Guangzhou Tinci Materials Technology going out to 2026, and you can see them free on our platform here.

Another way to search for interesting companies that could be reaching an inflection point is to track whether management are buying or selling, with our free list of growing companies 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.