Earnings Miss: Shenzhen Capchem Technology Co., Ltd. Missed EPS By 16% And Analysts Are Revising Their Forecasts

As you might know, Shenzhen Capchem Technology Co., Ltd. (SZSE:300037) recently reported its yearly numbers. Revenues were in line with forecasts, at CN¥7.8b, although statutory earnings per share came in 16% below what the analysts expected, at CN¥1.21 per share. 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 thought readers would find it interesting to see the analysts latest (statutory) post-earnings forecasts for next year.

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Taking into account the latest results, the most recent consensus for Shenzhen Capchem Technology from 13 analysts is for revenues of CN¥10.3b in 2025. If met, it would imply a substantial 31% increase on its revenue over the past 12 months. Per-share earnings are expected to jump 33% to CN¥1.66. In the lead-up to this report, the analysts had been modelling revenues of CN¥10.4b and earnings per share (EPS) of CN¥1.96 in 2025. The analysts seem to have become more bearish following the latest results. While there were no changes to revenue forecasts, there was a real cut to EPS estimates.

View our latest analysis for Shenzhen Capchem Technology

It might be a surprise to learn that the consensus price target was broadly unchanged at CN¥42.75, 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. Currently, the most bullish analyst values Shenzhen Capchem Technology at CN¥47.00 per share, while the most bearish prices it at CN¥35.00. This is a very narrow spread of estimates, implying either that Shenzhen Capchem Technology is an easy company to value, or - more likely - the analysts are relying heavily on some key assumptions.

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. The analysts are definitely expecting Shenzhen Capchem Technology's growth to accelerate, with the forecast 31% annualised growth to the end of 2025 ranking favourably alongside historical growth of 21% per annum over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to grow their revenue at 16% per year. Factoring in the forecast acceleration in revenue, it's pretty clear that Shenzhen Capchem Technology is expected to grow much faster than its industry.

The Bottom Line

The biggest concern is that the analysts reduced their earnings per share estimates, suggesting business headwinds could lay ahead for Shenzhen Capchem Technology. Happily, there were no major changes to revenue forecasts, with the business still expected to grow faster than the wider industry. There was no real change to the consensus price target, suggesting that the intrinsic value of the business has not undergone any major changes with the latest estimates.

With that in mind, we wouldn't be too quick to come to a conclusion on Shenzhen Capchem Technology. Long-term earnings power is much more important than next year's profits. We have estimates - from multiple Shenzhen Capchem Technology analysts - going out to 2027, and you can see them free on our platform here.

Plus, you should also learn about the 1 warning sign we've spotted with Shenzhen Capchem Technology .

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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.