Earnings Miss: Zhangzhou Pientzehuang Pharmaceutical., Ltd Missed EPS By 39% And Analysts Are Revising Their Forecasts

Zhangzhou Pientzehuang Pharmaceutical., Ltd (SHSE:600436) missed earnings with its latest second-quarter results, disappointing overly-optimistic forecasters. Zhangzhou Pientzehuang Pharmaceutical delivered a grave earnings miss, with both revenues (CN¥2.5b) and statutory earnings per share (CN¥0.93) falling badly short of analyst expectations. The analysts typically update their forecasts at each earnings report, and we can judge from their estimates whether their view of the company has changed or if there are any new concerns to be aware of. We thought readers would find it interesting to see the analysts latest (statutory) post-earnings forecasts for next year.

See our latest analysis for Zhangzhou Pientzehuang Pharmaceutical

Following the latest results, Zhangzhou Pientzehuang Pharmaceutical's eleven analysts are now forecasting revenues of CN¥11.2b in 2024. This would be a credible 5.4% improvement in revenue compared to the last 12 months. Per-share earnings are expected to rise 6.4% to CN¥5.25. In the lead-up to this report, the analysts had been modelling revenues of CN¥11.2b and earnings per share (EPS) of CN¥5.40 in 2024. So it looks like there's been a small decline in overall sentiment after the recent results - there's been no major change to revenue estimates, but the analysts did make a minor downgrade to their earnings per share forecasts.

The consensus price target held steady at CN¥266, with the analysts seemingly voting that their lower forecast earnings are not expected to lead to a lower stock price in the foreseeable future. Fixating on a single price target can be unwise though, since the consensus target is effectively the average of analyst price targets. As a result, some investors like to look at the range of estimates to see if there are any diverging opinions on the company's valuation. Currently, the most bullish analyst values Zhangzhou Pientzehuang Pharmaceutical at CN¥358 per share, while the most bearish prices it at CN¥170. This is a fairly broad spread of estimates, suggesting that analysts are forecasting a wide range of possible outcomes for the business.

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. We can infer from the latest estimates that forecasts expect a continuation of Zhangzhou Pientzehuang Pharmaceutical'shistorical trends, as the 11% annualised revenue growth to the end of 2024 is roughly in line with the 14% annual growth over the past five years. Juxtapose this against our data, which suggests that other companies (with analyst coverage) in the industry are forecast to see their revenues grow 12% per year. It's clear that while Zhangzhou Pientzehuang Pharmaceutical's revenue growth is expected to continue on its current trajectory, it's only expected to grow in line with the industry itself.

The Bottom Line

The most important thing to take away is that the analysts downgraded their earnings per share estimates, showing that there has been a clear decline in sentiment following these results. They also reconfirmed their revenue estimates, with the company predicted to grow at about the same rate as the wider industry. The consensus price target held steady at CN¥266, with the latest estimates not enough to have an impact on their price targets.

Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. At Simply Wall St, we have a full range of analyst estimates for Zhangzhou Pientzehuang Pharmaceutical going out to 2026, and you can see them free on our platform here..

Before you take the next step you should know about the 2 warning signs for Zhangzhou Pientzehuang Pharmaceutical (1 can't be ignored!) that we have uncovered.

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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.