Hubei Dinglong CO.,Ltd. (SZSE:300054) Released Earnings Last Week And Analysts Lifted Their Price Target To CN¥25.50

Hubei Dinglong CO.,Ltd. (SZSE:300054) missed earnings with its latest full-year results, disappointing overly-optimistic forecasters. Hubei DinglongLtd missed analyst forecasts, with revenues of CN¥2.7b and statutory earnings per share (EPS) of CN¥0.24, falling short by 3.3% and 4.7% respectively. 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 gathered the latest post-earnings forecasts to see what estimates suggest is in store for next year.

View our latest analysis for Hubei DinglongLtd

After the latest results, the nine analysts covering Hubei DinglongLtd are now predicting revenues of CN¥3.16b in 2024. If met, this would reflect a notable 18% improvement in revenue compared to the last 12 months. Per-share earnings are expected to soar 87% to CN¥0.44. Before this earnings report, the analysts had been forecasting revenues of CN¥3.27b and earnings per share (EPS) of CN¥0.51 in 2024. From this we can that sentiment has definitely become more bearish after the latest results, leading to lower revenue forecasts and a real cut to earnings per share estimates.

The average price target climbed 12% to CN¥25.50despite the reduced earnings forecasts, suggesting that this earnings impact could be a positive for the stock, once it passes. There's another way to think about price targets though, and that's to look at the range of price targets put forward by analysts, because a wide range of estimates could suggest a diverse view on possible outcomes for the business. The most optimistic Hubei DinglongLtd analyst has a price target of CN¥27.00 per share, while the most pessimistic values it at CN¥24.00. With such a narrow range of valuations, the analysts apparently share similar views on what they think the business is worth.

Of course, another way to look at these forecasts is to place them into context against the industry itself. We can infer from the latest estimates that forecasts expect a continuation of Hubei DinglongLtd'shistorical trends, as the 18% annualised revenue growth to the end of 2024 is roughly in line with the 19% annual growth over the past five years. Juxtapose this against our data, which suggests that other companies (with analyst coverage) in the industry are forecast to see their revenues grow 16% per year. It's clear that while Hubei DinglongLtd's revenue growth is expected to continue on its current trajectory, it's only expected to grow in line with the industry itself.

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. Sadly, they also downgraded their revenue forecasts, but the business is still expected to grow at roughly the same rate as the industry itself. We note an upgrade to the price target, suggesting that the analysts believes the intrinsic value of the business is likely to improve over time.

Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. We have estimates - from multiple Hubei DinglongLtd analysts - going out to 2026, and you can see them free on our platform here.

And what about risks? Every company has them, and we've spotted 1 warning sign for Hubei DinglongLtd 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.