Analysts Have Lowered Expectations For Dizal (Jiangsu) Pharmaceutical Co., Ltd. (SHSE:688192) After Its Latest Results

Investors in Dizal (Jiangsu) Pharmaceutical Co., Ltd. (SHSE:688192) had a good week, as its shares rose 8.1% to close at CN¥48.25 following the release of its full-year results. It was a weak result overall, with Dizal (Jiangsu) Pharmaceutical reporting CN¥360m in revenues, which was 21% less than what the analysts had expected. This is an important time for investors, as they can track a company's performance in its report, look at what experts are forecasting for next year, and see if there has been any change to expectations for the business. We've gathered the most recent statutory forecasts to see whether the analysts have changed their earnings models, following these results.

Check out our latest analysis for Dizal (Jiangsu) Pharmaceutical

Following the latest results, Dizal (Jiangsu) Pharmaceutical's five analysts are now forecasting revenues of CN¥754.0m in 2025. This would be a substantial 109% improvement in revenue compared to the last 12 months. Losses are supposed to decline, shrinking 15% from last year to CN¥1.74. Before this latest report, the consensus had been expecting revenues of CN¥947.3m and CN¥1.35 per share in losses. There's been a definite change in sentiment in this update, with the analysts administering a notable cut to next year's revenue estimates, while at the same time increasing their loss per share forecasts.

There was no major change to the consensus price target of CN¥56.00, signalling that the business is performing roughly in line with expectations, despite lower earnings per share forecasts. The consensus price target is just an average of individual analyst targets, so - it could be handy to see how wide the range of underlying estimates is. Currently, the most bullish analyst values Dizal (Jiangsu) Pharmaceutical at CN¥58.00 per share, while the most bearish prices it at CN¥54.00. Even so, with a relatively close grouping of estimates, it looks like the analysts are quite confident in their valuations, suggesting Dizal (Jiangsu) Pharmaceutical is an easy business to forecast or the the analysts are all using similar assumptions.

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. The analysts are definitely expecting Dizal (Jiangsu) Pharmaceutical's growth to accelerate, with the forecast 109% annualised growth to the end of 2025 ranking favourably alongside historical growth of 73% per annum over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to grow their revenue at 25% per year. It seems obvious that, while the growth outlook is brighter than the recent past, the analysts also expect Dizal (Jiangsu) Pharmaceutical to grow faster than the wider industry.

The Bottom Line

The most important thing to note is the forecast of increased losses next year, suggesting all may not be well at Dizal (Jiangsu) Pharmaceutical. They also downgraded Dizal (Jiangsu) Pharmaceutical's revenue estimates, but industry data suggests that it is expected to grow faster than the wider industry. There was no real change to the consensus price target, suggesting that the intrinsic value of the business has not undergone any major changes with the latest estimates.

Following on from that line of thought, we think that the long-term prospects of the business are much more relevant than next year's earnings. We have estimates - from multiple Dizal (Jiangsu) Pharmaceutical analysts - going out to 2027, and you can see them free on our platform here.

That said, it's still necessary to consider the ever-present spectre of investment risk. We've identified 2 warning signs with Dizal (Jiangsu) Pharmaceutical (at least 1 which is significant) , and understanding these should be part of your investment process.

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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.