Time To Worry? Analysts Are Downgrading Their Aerospace CH UAV Co.,Ltd (SZSE:002389) Outlook

The latest analyst coverage could presage a bad day for Aerospace CH UAV Co.,Ltd (SZSE:002389), with the analysts making across-the-board cuts to their statutory estimates that might leave shareholders a little shell-shocked. Revenue and earnings per share (EPS) forecasts were both revised downwards, with the analysts seeing grey clouds on the horizon. At CN¥16.60, shares are up 8.7% in the past 7 days. We'd be curious to see if the downgrade is enough to reverse investor sentiment on the business.

After this downgrade, Aerospace CH UAVLtd's four analysts are now forecasting revenues of CN¥4.3b in 2024. This would be a sizeable 51% improvement in sales compared to the last 12 months. Statutory earnings per share are presumed to leap 139% to CN¥0.37. Previously, the analysts had been modelling revenues of CN¥6.0b and earnings per share (EPS) of CN¥0.63 in 2024. Indeed, we can see that the analysts are a lot more bearish about Aerospace CH UAVLtd's prospects, administering a sizeable cut to revenue estimates and slashing their EPS estimates to boot.

View our latest analysis for Aerospace CH UAVLtd

The consensus price target fell 20% to CN¥21.60, with the weaker earnings outlook clearly leading analyst valuation estimates.

Of course, another way to look at these forecasts is to place them into context against the industry itself. The analysts are definitely expecting Aerospace CH UAVLtd's growth to accelerate, with the forecast 51% annualised growth to the end of 2024 ranking favourably alongside historical growth of 4.0% per annum over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to grow their revenue at 18% per year. Factoring in the forecast acceleration in revenue, it's pretty clear that Aerospace CH UAVLtd is expected to grow much faster than its 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 Aerospace CH UAVLtd. While analysts did downgrade their revenue estimates, these forecasts still imply revenues will perform better than the wider market. Given the scope of the downgrades, it would not be a surprise to see the market become more wary of the business.

Still, the long-term prospects of the business are much more relevant than next year's earnings. At Simply Wall St, we have a full range of analyst estimates for Aerospace CH UAVLtd going out to 2026, 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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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.