Yusys Technologies Co., Ltd. (SZSE:300674) Analysts Just Slashed This Year's Revenue Estimates By 16%

One thing we could say about the analysts on Yusys Technologies Co., Ltd. (SZSE:300674) - they aren't optimistic, having just made a major negative revision to their near-term (statutory) forecasts for the organization. This report focused on revenue estimates, and it looks as though the consensus view of the business has become substantially more conservative. At CN¥10.39, shares are up 6.6% in the past 7 days. It will be interesting to see if this downgrade motivates investors to start selling their holdings.

Following the latest downgrade, Yusys Technologies' seven analysts currently expect revenues in 2024 to be CN¥4.8b, approximately in line with the last 12 months. Statutory earnings per share are presumed to accumulate 9.7% to CN¥0.51. Before this latest update, the analysts had been forecasting revenues of CN¥5.7b and earnings per share (EPS) of CN¥0.56 in 2024. It looks like analyst sentiment has fallen somewhat in this update, with a substantial drop in revenue estimates and a small dip in earnings per share numbers as well.

Check out our latest analysis for Yusys Technologies

The consensus price target fell 17% to CN¥14.33, with the weaker earnings outlook clearly leading analyst valuation estimates.

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Yusys Technologies' past performance and to peers in the same industry. It's pretty clear that there is an expectation that Yusys Technologies' revenue growth will slow down substantially, with revenues to the end of 2024 expected to display 0.9% growth on an annualised basis. This is compared to a historical growth rate of 16% 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 15% 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 Yusys Technologies.

The Bottom Line

The biggest issue in the new estimates is that analysts have reduced their earnings per share estimates, suggesting business headwinds lay ahead for Yusys Technologies. Unfortunately analysts also downgraded their revenue estimates, and industry data suggests that Yusys Technologies' revenues are expected to grow slower than the wider market. Furthermore, there was a cut to the price target, suggesting that the latest news has led to more pessimism about the intrinsic value of the business. Given the stark change in sentiment, we'd understand if investors became more cautious on Yusys Technologies after today.

With that said, the long-term trajectory of the company's earnings is a lot more important than next year. At Simply Wall St, we have a full range of analyst estimates for Yusys Technologies going out to 2026, and you can see them free on our platform here.

Of course, seeing company management invest large sums of money in a stock can be just as useful as knowing whether analysts are downgrading their estimates. So you may also wish to search this free list of stocks with high insider ownership.

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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.