Lushang Freda Pharmaceutical Co.,Ltd. Just Missed EPS By 15%: Here's What Analysts Think Will Happen Next

Lushang Freda Pharmaceutical Co.,Ltd. (SHSE:600223) missed earnings with its latest yearly results, disappointing overly-optimistic forecasters. It wasn't a great result overall - while revenue fell marginally short of analyst estimates at CN¥4.0b, statutory earnings missed forecasts by 15%, coming in at just CN¥0.24 per share. Following the result, the analysts have updated their earnings model, and it would be good to know whether they think there's been a strong change in the company's prospects, or if it's business as usual. We've gathered the most recent statutory forecasts to see whether the analysts have changed their earnings models, following these results.

After the latest results, the nine analysts covering Lushang Freda PharmaceuticalLtd are now predicting revenues of CN¥4.48b in 2025. If met, this would reflect a solid 12% improvement in revenue compared to the last 12 months. Per-share earnings are expected to surge 25% to CN¥0.30. In the lead-up to this report, the analysts had been modelling revenues of CN¥4.77b and earnings per share (EPS) of CN¥0.36 in 2025. The analysts seem less optimistic after the recent results, reducing their revenue forecasts and making a substantial drop in earnings per share numbers.

See our latest analysis for Lushang Freda PharmaceuticalLtd

It'll come as no surprise then, to learn that the analysts have cut their price target 5.7% to CN¥8.79. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. There are some variant perceptions on Lushang Freda PharmaceuticalLtd, with the most bullish analyst valuing it at CN¥9.00 and the most bearish at CN¥8.28 per share. With such a narrow range of valuations, the analysts apparently share similar views on what they think the business is worth.

Looking at the bigger picture now, one of the ways we can make sense of these forecasts is to see how they measure up against both past performance and industry growth estimates. One thing stands out from these estimates, which is that Lushang Freda PharmaceuticalLtd is forecast to grow faster in the future than it has in the past, with revenues expected to display 12% annualised growth until the end of 2025. If achieved, this would be a much better result than the 16% annual decline over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in the industry are forecast to see their revenue grow 0.6% per year. So it looks like Lushang Freda PharmaceuticalLtd is expected to grow faster than its competitors, at least for a while.

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. Regrettably, they also downgraded their revenue estimates, but the latest forecasts still imply the business will grow faster than the wider industry. The consensus price target fell measurably, with the analysts seemingly not reassured by the latest results, leading to a lower estimate of Lushang Freda PharmaceuticalLtd's future valuation.

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 Lushang Freda PharmaceuticalLtd going out to 2027, and you can see them free on our platform here..

We don't want to rain on the parade too much, but we did also find 1 warning sign for Lushang Freda PharmaceuticalLtd that you need to be mindful of.

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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.