Fujian Star-net Communication Co., LTD. Earnings Missed Analyst Estimates: Here's What Analysts Are Forecasting Now

Fujian Star-net Communication Co., LTD. (SZSE:002396) just released its latest quarterly report and things are not looking great. Fujian Star-net Communication missed analyst forecasts, with revenues of CN¥4.2b and statutory earnings per share (EPS) of CN¥0.19, falling short by 2.1% and 9.5% respectively. This is an important time for investors, as they can track a company's performance in its report, look at what experts are forecasting for next year, and see if there has been any change to expectations for the business. So we collected the latest post-earnings statutory consensus estimates to see what could be in store for next year.

View our latest analysis for Fujian Star-net Communication

Taking into account the latest results, the most recent consensus for Fujian Star-net Communication from four analysts is for revenues of CN¥18.9b in 2024. If met, it would imply a solid 16% increase on its revenue over the past 12 months. Statutory earnings per share are predicted to bounce 57% to CN¥0.93. Before this earnings report, the analysts had been forecasting revenues of CN¥18.0b and earnings per share (EPS) of CN¥0.98 in 2024. Overall it looks as though the analysts were a bit mixed on the latest results. Although there was a a solid to revenue, the consensus also made a small dip in its earnings per share forecasts.

The analysts also cut Fujian Star-net Communication's price target 13% to CN¥17.08, implying that lower forecast earnings are expected to have a more negative impact than can be offset by the increase in revenue. That's not the only conclusion we can draw from this data however, as some investors also like to consider the spread in estimates when evaluating analyst price targets. Currently, the most bullish analyst values Fujian Star-net Communication at CN¥18.15 per share, while the most bearish prices it at CN¥16.00. Even so, with a relatively close grouping of estimates, it looks like the analysts are quite confident in their valuations, suggesting Fujian Star-net Communication is an easy business to forecast or the the analysts are all using similar assumptions.

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 Fujian Star-net Communication's rate of growth is expected to accelerate meaningfully, with the forecast 35% annualised revenue growth to the end of 2024 noticeably faster than its historical growth of 14% p.a. over the past five years. Compare this with other companies in the same industry, which are forecast to grow their revenue 21% annually. It seems obvious that, while the growth outlook is brighter than the recent past, the analysts also expect Fujian Star-net Communication to grow faster than the wider industry.

The Bottom Line

The biggest concern is that the analysts reduced their earnings per share estimates, suggesting business headwinds could lay ahead for Fujian Star-net Communication. Happily, they also upgraded their revenue estimates, and are forecasting them to grow faster than the wider industry. Furthermore, the analysts also cut their price targets, suggesting that the latest news has led to greater pessimism about the intrinsic value of the business.

Following on from that line of thought, we think that the long-term prospects of the business are much more relevant than next year's earnings. We have forecasts for Fujian Star-net Communication going out to 2026, and you can see them free on our platform here.

Even so, be aware that Fujian Star-net Communication is showing 2 warning signs in our investment analysis , you should know about...

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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.