Asymchem Laboratories (Tianjin) Co., Ltd. (SZSE:002821) Just Missed Earnings: Here's What Analysts Think Will Happen Next

It's shaping up to be a tough period for Asymchem Laboratories (Tianjin) Co., Ltd. (SZSE:002821), which a week ago released some disappointing full-year results that could have a notable impact on how the market views the stock. Asymchem Laboratories (Tianjin) missed analyst forecasts, with revenues of CN¥7.8b and statutory earnings per share (EPS) of CN¥6.26, falling short by 7.7% and 8.7% respectively. 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. So we gathered the latest post-earnings forecasts to see what estimates suggest is in store for next year.

View our latest analysis for Asymchem Laboratories (Tianjin)

Taking into account the latest results, the 14 analysts covering Asymchem Laboratories (Tianjin) provided consensus estimates of CN¥6.59b revenue in 2024, which would reflect a definite 16% decline over the past 12 months. Statutory earnings per share are expected to nosedive 36% to CN¥4.00 in the same period. Before this earnings report, the analysts had been forecasting revenues of CN¥8.30b and earnings per share (EPS) of CN¥5.92 in 2024. It looks like sentiment has declined substantially in the aftermath of these results, with a pretty serious reduction to revenue estimates and a large cut to earnings per share numbers as well.

It'll come as no surprise then, to learn that the analysts have cut their price target 22% to CN¥118. That's not the only conclusion we can draw from this data however, as some investors also like to consider the spread in estimates when evaluating analyst price targets. There are some variant perceptions on Asymchem Laboratories (Tianjin), with the most bullish analyst valuing it at CN¥174 and the most bearish at CN¥85.00 per share. This is a fairly broad spread of estimates, suggesting that analysts are forecasting a wide range of possible outcomes for the business.

Taking a look at the bigger picture now, one of the ways we can understand these forecasts is to see how they compare to both past performance and industry growth estimates. We would highlight that revenue is expected to reverse, with a forecast 16% annualised decline to the end of 2024. That is a notable change from historical growth of 36% over the last five years. Compare this with our data, which suggests that other companies in the same industry are, in aggregate, expected to see their revenue grow 15% per year. It's pretty clear that Asymchem Laboratories (Tianjin)'s revenues are expected to perform substantially worse than the wider industry.

The Bottom Line

The biggest concern is that the analysts reduced their earnings per share estimates, suggesting business headwinds could lay ahead for Asymchem Laboratories (Tianjin). On the negative side, they also downgraded their revenue estimates, and forecasts imply they will perform worse than the wider industry. Furthermore, the analysts also cut their price targets, suggesting that the latest news has led to greater pessimism about the intrinsic value of the business.

Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. We have forecasts for Asymchem Laboratories (Tianjin) going out to 2026, 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 Asymchem Laboratories (Tianjin) (at least 1 which is a bit concerning) , 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.