Jiangsu Changhai Composite Materials Co., Ltd (SZSE:300196) Analysts Just Cut Their EPS Forecasts Substantially

The analysts covering Jiangsu Changhai Composite Materials Co., Ltd (SZSE:300196) 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.

After the downgrade, the seven analysts covering Jiangsu Changhai Composite Materials are now predicting revenues of CN¥2.9b in 2024. If met, this would reflect a notable 12% improvement in sales compared to the last 12 months. Statutory earnings per share are presumed to increase 9.1% to CN¥0.79. Prior to this update, the analysts had been forecasting revenues of CN¥3.5b and earnings per share (EPS) of CN¥1.31 in 2024. It looks like analyst sentiment has declined substantially, with a substantial drop in revenue estimates and a large cut to earnings per share numbers as well.

Check out our latest analysis for Jiangsu Changhai Composite Materials

It'll come as no surprise then, to learn that the analysts have cut their price target 24% to CN¥12.43.

Of course, another way to look at these forecasts is to place them into context against the industry itself. 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. It seems obvious that, while the future growth outlook is brighter than the recent past, Jiangsu Changhai Composite Materials is expected to grow slower than the wider industry.

The Bottom Line

The biggest issue in the new estimates is that analysts have reduced their earnings per share estimates, suggesting business headwinds lay ahead for Jiangsu Changhai Composite Materials. Unfortunately analysts also downgraded their revenue estimates, and industry data suggests that Jiangsu Changhai Composite Materials' revenues are expected to grow slower than the wider market. With a serious cut to this year's expectations and a falling price target, we wouldn't be surprised if investors were becoming wary of Jiangsu Changhai Composite Materials.

Even so, the longer term trajectory of the business is much more important for the value creation of shareholders. 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.

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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.