Jiangsu Changhai Composite Materials Co., Ltd Earnings Missed Analyst Estimates: Here's What Analysts Are Forecasting Now

As you might know, Jiangsu Changhai Composite Materials Co., Ltd (SZSE:300196) last week released its latest full-year, and things did not turn out so great for shareholders. Results showed a clear earnings miss, with CN¥2.6b revenue coming in 6.0% lower than what the analystsexpected. Statutory earnings per share (EPS) of CN¥0.71 missed the mark badly, arriving some 28% below what was expected. 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. So we collected the latest post-earnings statutory consensus estimates to see what could be in store for next year.

Check out our latest analysis for Jiangsu Changhai Composite Materials

Following the latest results, Jiangsu Changhai Composite Materials' seven analysts are now forecasting revenues of CN¥2.91b in 2024. This would be a meaningful 12% improvement in revenue compared to the last 12 months. Per-share earnings are expected to increase 9.1% to CN¥0.79. Before this earnings report, the analysts had been forecasting revenues of CN¥3.49b and earnings per share (EPS) of CN¥1.31 in 2024. It looks like sentiment has declined substantially in the aftermath of these results, with a real cut to revenue estimates and a pretty serious reduction to earnings per share numbers as well.

The consensus price target fell 24% to CN¥12.43, with the weaker earnings outlook clearly leading valuation estimates. That's not the only conclusion we can draw from this data however, as some investors also like to consider the spread in estimates when evaluating analyst price targets. Currently, the most bullish analyst values Jiangsu Changhai Composite Materials at CN¥13.00 per share, while the most bearish prices it at CN¥11.73. With such a narrow range of valuations, the analysts apparently share similar views on what they think the business is worth.

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. It's clear from the latest estimates that Jiangsu Changhai Composite Materials' rate of growth is expected to accelerate meaningfully, with the forecast 12% annualised revenue growth to the end of 2024 noticeably faster than its historical growth of 6.8% p.a. 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. So it's clear that despite the acceleration in growth, Jiangsu Changhai Composite Materials is expected to grow meaningfully slower than the industry average.

The Bottom Line

The biggest concern is that the analysts reduced their earnings per share estimates, suggesting business headwinds could lay ahead for Jiangsu Changhai Composite Materials. Unfortunately, they also downgraded their revenue estimates, and our data indicates underperformance compared to the wider industry. Even so, earnings per share are more important to the intrinsic value of the business. The consensus price target fell measurably, with the analysts seemingly not reassured by the latest results, leading to a lower estimate of Jiangsu Changhai Composite Materials' future valuation.

With that in mind, we wouldn't be too quick to come to a conclusion on Jiangsu Changhai Composite Materials. Long-term earnings power is much more important than next year's profits. At Simply Wall St, we have a full range of analyst estimates for Jiangsu Changhai Composite Materials going out to 2026, and you can see them free on our platform here..

Even so, be aware that Jiangsu Changhai Composite Materials 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.