Bearish: Analysts Just Cut Their Appotronics Corporation Limited (SHSE:688007) Revenue and EPS estimates

One thing we could say about the analysts on Appotronics Corporation Limited (SHSE:688007) - they aren't optimistic, having just made a major negative revision to their near-term (statutory) forecasts for the organization. Both revenue and earnings per share (EPS) estimates were cut sharply as the analysts factored in the latest outlook for the business, concluding that they were too optimistic previously.

After this downgrade, Appotronics' eight analysts are now forecasting revenues of CN¥2.4b in 2024. This would be a decent 10% improvement in sales compared to the last 12 months. Per-share earnings are expected to swell 18% to CN¥0.26. Prior to this update, the analysts had been forecasting revenues of CN¥3.1b and earnings per share (EPS) of CN¥0.56 in 2024. Indeed, we can see that the analysts are a lot more bearish about Appotronics' prospects, administering a pretty serious reduction to revenue estimates and slashing their EPS estimates to boot.

See our latest analysis for Appotronics

Another way we can view these estimates is in the context of the bigger picture, such as how the forecasts stack up against past performance, and whether forecasts are more or less bullish relative to other companies in the industry. The period to the end of 2024 brings more of the same, according to the analysts, with revenue forecast to display 10% growth on an annualised basis. That is in line with its 9.8% annual growth over the past five years. Compare this with the broader industry (in aggregate), which analyst estimates suggest will see revenues grow 19% annually. So it's pretty clear that Appotronics is expected to grow slower than similar companies in the same industry.

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 Appotronics. Unfortunately analysts also downgraded their revenue estimates, and industry data suggests that Appotronics' revenues are expected to grow slower than the wider market. Given the serious cut to this year's outlook, it's clear that analysts have turned more bearish on Appotronics, and we wouldn't blame shareholders for feeling a little more cautious themselves.

Even so, the longer term trajectory of the business is much more important for the value creation of shareholders. We have estimates - from multiple Appotronics analysts - going out to 2025, and you can see them free on our platform here.

Another way to search for interesting companies that could be reaching an inflection point is to track whether management are buying or selling, with our free list of growing companies that insiders are buying.

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