Need To Know: This Analyst Just Made A Substantial Cut To Their Guangdong Modern High-tech Fiber Co., Ltd (SZSE:300876) Estimates

One thing we could say about the covering analyst on Guangdong Modern High-tech Fiber Co., Ltd (SZSE:300876) - they aren't optimistic, having just made a major negative revision to their near-term (statutory) forecasts for the organization. Both revenue and earnings per share (EPS) forecasts went under the knife, suggesting the analyst has soured majorly on the business.

After this downgrade, Guangdong Modern High-tech Fiber's solo analyst is now forecasting revenues of CN¥506m in 2024. This would be a meaningful 11% improvement in sales compared to the last 12 months. Per-share earnings are expected to leap 222% to CN¥0.72. Before this latest update, the analyst had been forecasting revenues of CN¥696m and earnings per share (EPS) of CN¥0.97 in 2024. Indeed, we can see that the analyst is a lot more bearish about Guangdong Modern High-tech Fiber's prospects, administering a pretty serious reduction to revenue estimates and slashing their EPS estimates to boot.

Check out our latest analysis for Guangdong Modern High-tech Fiber

It'll come as no surprise then, to learn that the analyst has cut their price target 35% to CN¥22.11.

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 Guangdong Modern High-tech Fiber's rate of growth is expected to accelerate meaningfully, with the forecast 11% annualised revenue growth to the end of 2024 noticeably faster than its historical growth of 3.5% p.a. over the past five years. Compare this with other companies in the same industry, which are forecast to see revenue growth of 16% annually. It seems obvious that, while the future growth outlook is brighter than the recent past, Guangdong Modern High-tech Fiber is expected to grow slower than the wider industry.

The Bottom Line

The biggest issue in the new estimates is that the analyst has reduced their earnings per share estimates, suggesting business headwinds lay ahead for Guangdong Modern High-tech Fiber. Regrettably, they also downgraded their revenue estimates, and the latest forecasts imply the business will grow sales slower than the wider market. After such a stark change in sentiment from the analyst, we'd understand if readers now felt a bit wary of Guangdong Modern High-tech Fiber.

There might be good reason for analyst bearishness towards Guangdong Modern High-tech Fiber, like concerns around earnings quality. For more information, you can click here to discover this and the 3 other concerns we've identified.

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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.