Stock Analysis

Xinxiang Richful Lube Additive Co.,Ltd. (SZSE:300910) Analysts Are Reducing Their Forecasts For This Year

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Today is shaping up negative for Xinxiang Richful Lube Additive Co.,Ltd. (SZSE:300910) shareholders, with the analysts delivering a substantial negative revision to this year's forecasts. Revenue and earnings per share (EPS) forecasts were both revised downwards, with the analysts seeing grey clouds on the horizon.

After this downgrade, Xinxiang Richful Lube AdditiveLtd's two analysts are now forecasting revenues of CN¥3.4b in 2024. This would be a decent 19% improvement in sales compared to the last 12 months. Per-share earnings are expected to rise 9.9% to CN¥2.31. Before this latest update, the analysts had been forecasting revenues of CN¥4.7b and earnings per share (EPS) of CN¥2.82 in 2024. Indeed, we can see that the analysts are a lot more bearish about Xinxiang Richful Lube AdditiveLtd's prospects, administering a pretty serious reduction to revenue estimates and slashing their EPS estimates to boot.

Check out our latest analysis for Xinxiang Richful Lube AdditiveLtd

SZSE:300910 Earnings and Revenue Growth March 29th 2024

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Xinxiang Richful Lube AdditiveLtd's past performance and to peers in the same industry. We would highlight that Xinxiang Richful Lube AdditiveLtd's revenue growth is expected to slow, with the forecast 19% annualised growth rate until the end of 2024 being well below the historical 39% p.a. growth over the last five years. Compare this to the 484 other companies in this industry with analyst coverage, which are forecast to grow their revenue at 17% per year. So it's pretty clear that, while Xinxiang Richful Lube AdditiveLtd's revenue growth is expected to slow, it's expected to grow roughly in line with the 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 Xinxiang Richful Lube AdditiveLtd. There was also a drop in their revenue estimates, although as we saw earlier, forecast growth is only expected to be about the same as the wider market. We wouldn't be surprised to find shareholders feeling a bit shell-shocked, after these downgrades. It looks like analysts have become a lot more bearish on Xinxiang Richful Lube AdditiveLtd, and their negativity could be grounds for caution.

So things certainly aren't looking great, and you should also know that we've spotted some potential warning signs with Xinxiang Richful Lube AdditiveLtd, including concerns around earnings quality. For more information, you can click here to discover this and the 1 other flag we've identified.

Of course, seeing company management invest large sums of money in a stock can be just as useful as knowing whether analysts are downgrading their estimates. So you may also wish to search this free list of stocks that insiders are buying.

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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.