Sunresin New Materials Co.,Ltd (SZSE:300487) Analysts Just Slashed This Year's Estimates

Market forces rained on the parade of Sunresin New Materials Co.,Ltd (SZSE:300487) shareholders today, when the analysts downgraded their forecasts for this year. Revenue and earnings per share (EPS) forecasts were both revised downwards, with analysts seeing grey clouds on the horizon.

Following the downgrade, the latest consensus from Sunresin New MaterialsLtd's twelve analysts is for revenues of CN¥3.0b in 2024, which would reflect a notable 16% improvement in sales compared to the last 12 months. Statutory earnings per share are presumed to expand 18% to CN¥1.76. Before this latest update, the analysts had been forecasting revenues of CN¥3.5b and earnings per share (EPS) of CN¥2.00 in 2024. Indeed, we can see that the analysts are a lot more bearish about Sunresin New MaterialsLtd's prospects, administering a measurable cut to revenue estimates and slashing their EPS estimates to boot.

Check out our latest analysis for Sunresin New MaterialsLtd

Analysts made no major changes to their price target of CN¥65.31, suggesting the downgrades are not expected to have a long-term impact on Sunresin New MaterialsLtd's valuation.

One way to get more context on these forecasts is to look at how they compare to both past performance, and how other companies in the same industry are performing. We can infer from the latest estimates that forecasts expect a continuation of Sunresin New MaterialsLtd'shistorical trends, as the 22% annualised revenue growth to the end of 2024 is roughly in line with the 25% annual revenue growth over the past five years. Compare this with the broader industry, which analyst estimates (in aggregate) suggest will see revenues grow 16% annually. So although Sunresin New MaterialsLtd is expected to maintain its revenue growth rate, it's definitely expected to grow faster 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 Sunresin New MaterialsLtd. Unfortunately, analysts also downgraded their revenue estimates, although our data indicates revenues are expected to perform better than the wider market. We're also surprised to see that the price target went unchanged. Still, deteriorating business conditions (assuming accurate forecasts!) can be a leading indicator for the stock price, so we wouldn't blame investors for being more cautious on Sunresin New MaterialsLtd after the downgrade.

After a downgrade like this, it's pretty clear that previous forecasts were too optimistic. What's more, we've spotted several possible issues with Sunresin New MaterialsLtd's business, like concerns around earnings quality. Learn more, and discover the 1 other warning sign we've identified, for 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.