Sino Wealth Electronic Ltd. Earnings Missed Analyst Estimates: Here's What Analysts Are Forecasting Now

It's shaping up to be a tough period for Sino Wealth Electronic Ltd. (SZSE:300327), which a week ago released some disappointing annual results that could have a notable impact on how the market views the stock. Unfortunately, Sino Wealth Electronic delivered a serious earnings miss. Revenues of CN¥1.3b were 11% below expectations, and statutory earnings per share of CN¥0.39 missed estimates by 24%. 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. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether the analysts have changed their mind on Sino Wealth Electronic after the latest results.

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Taking into account the latest results, the most recent consensus for Sino Wealth Electronic from six analysts is for revenues of CN¥1.54b in 2025. If met, it would imply a meaningful 15% increase on its revenue over the past 12 months. Per-share earnings are expected to leap 114% to CN¥0.85. Before this earnings report, the analysts had been forecasting revenues of CN¥1.89b and earnings per share (EPS) of CN¥0.88 in 2025. It looks like sentiment has fallen somewhat in the aftermath of these results, with a real cut to revenue estimates and a small dip in earnings per share numbers as well.

See our latest analysis for Sino Wealth Electronic

The analysts made no major changes to their price target of CN¥24.74, suggesting the downgrades are not expected to have a long-term impact on Sino Wealth Electronic's valuation. 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 Sino Wealth Electronic at CN¥28.00 per share, while the most bearish prices it at CN¥19.40. There are definitely some different views on the stock, but the range of estimates is not wide enough as to imply that the situation is unforecastable, in our view.

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. It's clear from the latest estimates that Sino Wealth Electronic's rate of growth is expected to accelerate meaningfully, with the forecast 15% annualised revenue growth to the end of 2025 noticeably faster than its historical growth of 7.5% p.a. 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 24% per year. So it's clear that despite the acceleration in growth, Sino Wealth Electronic is expected to grow meaningfully slower than the industry average.

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. Unfortunately, they also downgraded their revenue estimates, and our data indicates underperformance compared to the wider industry. Even so, earnings per share are more important to the intrinsic value of the business. The consensus price target held steady at CN¥24.74, with the latest estimates not enough to have an impact on their price targets.

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 forecasts for Sino Wealth Electronic going out to 2027, and you can see them free on our platform here.

However, before you get too enthused, we've discovered 2 warning signs for Sino Wealth Electronic that you should be aware 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.