Lizhong Sitong Light Alloys Group Co., Ltd. Just Missed Earnings - But Analysts Have Updated Their Models

It's shaping up to be a tough period for Lizhong Sitong Light Alloys Group Co., Ltd. (SZSE:300428), which a week ago released some disappointing annual results that could have a notable impact on how the market views the stock. Lizhong Sitong Light Alloys Group missed earnings this time around, with CN¥27b revenue coming in 4.2% below what the analysts had modelled. Statutory earnings per share (EPS) of CN¥1.10 also fell short of expectations by 11%. 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.

Check out our latest analysis for Lizhong Sitong Light Alloys Group

Taking into account the latest results, the most recent consensus for Lizhong Sitong Light Alloys Group from five analysts is for revenues of CN¥32.6b in 2025. If met, it would imply a decent 19% increase on its revenue over the past 12 months. Per-share earnings are expected to shoot up 39% to CN¥1.52. Before this earnings report, the analysts had been forecasting revenues of CN¥33.1b and earnings per share (EPS) of CN¥1.55 in 2025. The analysts seem to have become a little more negative on the business after the latest results, given the minor downgrade to their earnings per share numbers for next year.

The consensus price target held steady at CN¥25.61, with the analysts seemingly voting that their lower forecast earnings are not expected to lead to a lower stock price in the foreseeable future. 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. There are some variant perceptions on Lizhong Sitong Light Alloys Group, with the most bullish analyst valuing it at CN¥31.00 and the most bearish at CN¥21.00 per share. These price targets show that analysts do have some differing views on the business, but the estimates do not vary enough to suggest to us that some are betting on wild success or utter failure.

Another way we can view these estimates is in the context of the bigger picture, such as how the forecasts stack up against past performance, and whether forecasts are more or less bullish relative to other companies in the industry. The analysts are definitely expecting Lizhong Sitong Light Alloys Group's growth to accelerate, with the forecast 19% annualised growth to the end of 2025 ranking favourably alongside historical growth of 15% per annum over the past five years. Compare this with other companies in the same industry, which are forecast to grow their revenue 10% annually. Factoring in the forecast acceleration in revenue, it's pretty clear that Lizhong Sitong Light Alloys Group 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 Lizhong Sitong Light Alloys Group. Fortunately, they also reconfirmed their revenue numbers, suggesting that it's tracking in line with expectations. Additionally, our data suggests that revenue is 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.

Following on from that line of thought, we think that the long-term prospects of the business are much more relevant than next year's earnings. We have estimates - from multiple Lizhong Sitong Light Alloys Group analysts - going out to 2026, and you can see them free on our platform here.

It is also worth noting that we have found 2 warning signs for Lizhong Sitong Light Alloys Group (1 is a bit unpleasant!) that you need to take into consideration.

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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.