One Beijing Zhong Ke San Huan High-Tech Co., Ltd. (SZSE:000970) Analyst Is Reducing Their Forecasts For This Year

The latest analyst coverage could presage a bad day for Beijing Zhong Ke San Huan High-Tech Co., Ltd. (SZSE:000970), with the covering analyst making across-the-board cuts to their statutory estimates that might leave shareholders a little shell-shocked. Both revenue and earnings per share (EPS) estimates were cut sharply as the analyst factored in the latest outlook for the business, concluding that they were too optimistic previously.

Following the downgrade, the most recent consensus for Beijing Zhong Ke San Huan High-Tech from its solitary analyst is for revenues of CN¥8.0b in 2025 which, if met, would be a notable 19% increase on its sales over the past 12 months. Statutory earnings per share are presumed to leap 1,824% to CN¥0.19. Before this latest update, the analyst had been forecasting revenues of CN¥10.0b and earnings per share (EPS) of CN¥0.32 in 2025. It looks like analyst sentiment has declined substantially, with a measurable cut to revenue estimates and a large cut to earnings per share numbers as well.

View our latest analysis for Beijing Zhong Ke San Huan High-Tech

What's most unexpected is that the consensus price target rose 8.0% to CN¥12.12, strongly implying the downgrade to forecasts is not expected to be more than a temporary blip.

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Beijing Zhong Ke San Huan High-Tech's past performance and to peers in the same industry. It's clear from the latest estimates that Beijing Zhong Ke San Huan High-Tech's rate of growth is expected to accelerate meaningfully, with the forecast 19% annualised revenue growth to the end of 2025 noticeably faster than its historical growth of 13% p.a. over the past five years. Compare this with other companies in the same industry, which are forecast to grow their revenue 18% annually. Factoring in the forecast acceleration in revenue, it's pretty clear that Beijing Zhong Ke San Huan High-Tech is expected to grow at about the same rate as the wider industry.

The Bottom Line

The most important thing to take away is that the analyst cut their earnings per share estimates, expecting a clear decline in business conditions. Lamentably, they also downgraded their sales forecasts, but the business is still expected to grow at roughly the same rate as the market itself. The rising price target is a puzzle, but still - with a serious cut to this year's outlook, we wouldn't be surprised if investors were a bit wary of Beijing Zhong Ke San Huan High-Tech.

With that said, the long-term trajectory of the company's earnings is a lot more important than next year. We have analyst estimates for Beijing Zhong Ke San Huan High-Tech going out as far as 2027, and you can see them free on our platform here.

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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.