Luxshare Precision Industry Co., Ltd. Just Missed Revenue By 5.9%: Here's What Analysts Think Will Happen Next

Investors in Luxshare Precision Industry Co., Ltd. (SZSE:002475) had a good week, as its shares rose 3.2% to close at CN¥37.89 following the release of its quarterly results. Revenues came in 5.9% below expectations, at CN¥51b. Statutory earnings per share were relatively better off, with a per-share profit of CN¥0.40 being roughly in line with analyst estimates. 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. We thought readers would find it interesting to see the analysts latest (statutory) post-earnings forecasts for next year.

See our latest analysis for Luxshare Precision Industry

Taking into account the latest results, the current consensus from Luxshare Precision Industry's 28 analysts is for revenues of CN¥258.1b in 2024. This would reflect a notable 8.6% increase on its revenue over the past 12 months. Per-share earnings are expected to ascend 13% to CN¥1.89. Before this earnings report, the analysts had been forecasting revenues of CN¥261.1b and earnings per share (EPS) of CN¥1.96 in 2024. So it looks like there's been a small decline in overall sentiment after the recent results - there's been no major change to revenue estimates, but the analysts did make a minor downgrade to their earnings per share forecasts.

The consensus price target held steady at CN¥47.37, with the analysts seemingly voting that their lower forecast earnings are not expected to lead to a lower stock price in the foreseeable future. There's another way to think about price targets though, and that's to look at the range of price targets put forward by analysts, because a wide range of estimates could suggest a diverse view on possible outcomes for the business. The most optimistic Luxshare Precision Industry analyst has a price target of CN¥63.00 per share, while the most pessimistic values it at CN¥33.00. Note the wide gap in analyst price targets? This implies to us that there is a fairly broad range of possible scenarios for the underlying business.

One way to get more context on these forecasts is to look at how they compare to both past performance, and how other companies in the same industry are performing. It's pretty clear that there is an expectation that Luxshare Precision Industry's revenue growth will slow down substantially, with revenues to the end of 2024 expected to display 18% growth on an annualised basis. This is compared to a historical growth rate of 30% over the past five years. Juxtapose this against the other companies in the industry with analyst coverage, which are forecast to grow their revenues (in aggregate) 18% annually. Factoring in the forecast slowdown in growth, it looks like Luxshare Precision Industry is forecast to grow at about the same rate as the wider industry.

The Bottom Line

The most important thing to take away is that the analysts downgraded their earnings per share estimates, showing that there has been a clear decline in sentiment following these results. They also reconfirmed their revenue estimates, with the company predicted to grow at about the same rate as the wider industry. The consensus price target held steady at CN¥47.37, with the latest estimates not enough to have an impact on their price targets.

Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. We have forecasts for Luxshare Precision Industry going out to 2026, and you can see them free on our platform here.

You can also view our analysis of Luxshare Precision Industry's balance sheet, and whether we think Luxshare Precision Industry is carrying too much debt, for free on our platform here.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

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.