Jinyu Bio-technology Co., Ltd. (SHSE:600201) Analysts Are Reducing Their Forecasts For This Year

The analysts covering Jinyu Bio-technology Co., Ltd. (SHSE:600201) delivered a dose of negativity to shareholders today, by making a substantial revision to their statutory forecasts for this year. Revenue and earnings per share (EPS) forecasts were both revised downwards, with the analysts seeing grey clouds on the horizon.

After this downgrade, Jinyu Bio-technology's ten analysts are now forecasting revenues of CN¥1.8b in 2024. This would be a notable 11% improvement in sales compared to the last 12 months. Statutory earnings per share are presumed to ascend 19% to CN¥0.32. Previously, the analysts had been modelling revenues of CN¥2.1b and earnings per share (EPS) of CN¥0.36 in 2024. Indeed, we can see that the analysts are a lot more bearish about Jinyu Bio-technology's prospects, administering a measurable cut to revenue estimates and slashing their EPS estimates to boot.

View our latest analysis for Jinyu Bio-technology

Analysts made no major changes to their price target of CN¥9.38, suggesting the downgrades are not expected to have a long-term impact on Jinyu Bio-technology's valuation.

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. For example, we noticed that Jinyu Bio-technology's rate of growth is expected to accelerate meaningfully, with revenues forecast to exhibit 16% growth to the end of 2024 on an annualised basis. That is well above its historical decline of 0.1% a year over the past five years. Compare this against analyst estimates for the broader industry, which suggest that (in aggregate) industry revenues are expected to grow 24% annually for the foreseeable future. So although Jinyu Bio-technology's revenue growth is expected to improve, it is still expected to grow slower than 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 Jinyu Bio-technology. Unfortunately analysts also downgraded their revenue estimates, and industry data suggests that Jinyu Bio-technology's revenues are expected to grow slower than the wider market. The lack of change in the price target is puzzling in light of the downgrade but, with a serious decline expected this year, we wouldn't be surprised if investors were a bit wary of Jinyu Bio-technology.

Unfortunately, by using these new estimates as a starting point, we've run a discounted cash flow calculation (DCF) on Jinyu Bio-technology that suggests the company could be somewhat overvalued. Find out why, and see how we estimate the valuation for free on our platform here.

Another way to search for interesting companies that could be reaching an inflection point is to track whether management are buying or selling, with our free list of growing companies 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.