Glodon Company Limited Just Missed Earnings - But Analysts Have Updated Their Models

Glodon Company Limited (SZSE:002410) just released its latest full-year report and things are not looking great. Results showed a clear earnings miss, with CN¥6.5b revenue coming in 7.0% lower than what the analystsexpected. Statutory earnings per share (EPS) of CN¥0.07 missed the mark badly, arriving some 81% below what was expected. Earnings are an important time for investors, as they can track a company's performance, look at what the analysts are forecasting for next year, and see if there's been a change in sentiment towards the company. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether the analysts have changed their mind on Glodon after the latest results.

See our latest analysis for Glodon

Taking into account the latest results, the current consensus from Glodon's 26 analysts is for revenues of CN¥7.05b in 2024. This would reflect an okay 7.7% increase on its revenue over the past 12 months. Statutory earnings per share are predicted to shoot up 386% to CN¥0.34. In the lead-up to this report, the analysts had been modelling revenues of CN¥8.08b and earnings per share (EPS) of CN¥0.61 in 2024. Indeed, we can see that the analysts are a lot more bearish about Glodon's prospects following the latest results, administering a real cut to revenue estimates and slashing their EPS estimates to boot.

It'll come as no surprise then, to learn that the analysts have cut their price target 14% to CN¥19.37. 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 Glodon at CN¥48.86 per share, while the most bearish prices it at CN¥11.00. With such a wide range in price targets, analysts are almost certainly betting on widely divergent outcomes in the underlying business. With this in mind, we wouldn't rely too heavily the consensus price target, as it is just an average and analysts clearly have some deeply divergent views on the business.

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. It's pretty clear that there is an expectation that Glodon's revenue growth will slow down substantially, with revenues to the end of 2024 expected to display 7.7% growth on an annualised basis. This is compared to a historical growth rate of 19% over the past five years. Compare this against other companies (with analyst forecasts) in the industry, which are in aggregate expected to see revenue growth of 22% annually. So it's pretty clear that, while revenue growth is expected to slow down, the wider industry is also expected to grow faster than Glodon.

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. On the negative side, they also downgraded their revenue estimates, and forecasts imply they will perform worse 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 Glodon's future valuation.

With that in mind, we wouldn't be too quick to come to a conclusion on Glodon. Long-term earnings power is much more important than next year's profits. At Simply Wall St, we have a full range of analyst estimates for Glodon going out to 2026, and you can see them free on our platform here..

Plus, you should also learn about the 2 warning signs we've spotted with Glodon .

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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.