Time To Worry? Analysts Just Downgraded Their JWIPC Technology Co., Ltd. (SZSE:001339) Outlook

The latest analyst coverage could presage a bad day for JWIPC Technology Co., Ltd. (SZSE:001339), with the analysts making across-the-board cuts to their statutory estimates that might leave shareholders a little shell-shocked. Revenue estimates were cut sharply as analysts signalled a weaker outlook - perhaps a sign that investors should temper their expectations as well.

After this downgrade, JWIPC Technology's dual analysts are now forecasting revenues of CN¥4.2b in 2024. This would be a solid 16% improvement in sales compared to the last 12 months. Per-share earnings are expected to shoot up 1,162% to CN¥0.55. Prior to this update, the analysts had been forecasting revenues of CN¥4.7b and earnings per share (EPS) of CN¥1.15 in 2024. Indeed, we can see that the analysts are a lot more bearish about JWIPC Technology's prospects, administering a measurable cut to revenue estimates and slashing their EPS estimates to boot.

See our latest analysis for JWIPC Technology

What's most unexpected is that the consensus price target rose 27% to CN¥35.13, strongly implying the downgrade to forecasts is not expected to be more than a temporary blip.

Of course, another way to look at these forecasts is to place them into context against the industry itself. It's clear from the latest estimates that JWIPC Technology's rate of growth is expected to accelerate meaningfully, with the forecast 16% annualised revenue growth to the end of 2024 noticeably faster than its historical growth of 12% over the past year. Compare this with other companies in the same industry, which are forecast to grow their revenue 14% annually. JWIPC Technology is expected to grow at about the same rate as its industry, so it's not clear that we can draw any conclusions from its growth relative to competitors.

The Bottom Line

The most important thing to take away is that analysts 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. There was also a nice increase in the price target, with analysts apparently feeling that the intrinsic value of the business is improving. Overall, given the drastic downgrade to this year's forecasts, we'd be feeling a little more wary of JWIPC Technology going forwards.

As you can see, the analysts clearly aren't bullish, and there might be good reason for that. We've identified some potential issues with JWIPC Technology's financials, such as concerns around earnings quality. Learn more, and discover the 2 other risks we've identified, for 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 that insiders are buying.

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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.