Earnings Miss: Lingyi iTech (Guangdong) Company Missed EPS By 33% And Analysts Are Revising Their Forecasts

Lingyi iTech (Guangdong) Company (SZSE:002600) came out with its first-quarter results last week, and we wanted to see how the business is performing and what industry forecasters think of the company following this report. Statutory earnings per share fell badly short of expectations, coming in at CN¥0.07, some 33% below analyst forecasts, although revenues were okay, approximately in line with analyst estimates at CN¥9.8b. 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've gathered the most recent statutory forecasts to see whether the analysts have changed their earnings models, following these results.

View our latest analysis for Lingyi iTech (Guangdong)

After the latest results, the six analysts covering Lingyi iTech (Guangdong) are now predicting revenues of CN¥44.3b in 2024. If met, this would reflect a major 30% improvement in revenue compared to the last 12 months. Per-share earnings are expected to jump 34% to CN¥0.39. In the lead-up to this report, the analysts had been modelling revenues of CN¥43.7b and earnings per share (EPS) of CN¥0.44 in 2024. So there's definitely been a decline in sentiment after the latest results, noting the real cut to new EPS forecasts.

The consensus price target held steady at CN¥7.25, with the analysts seemingly voting that their lower forecast earnings are not expected to lead to a lower stock price in the foreseeable future. Fixating on a single price target can be unwise though, since the consensus target is effectively the average of analyst price targets. As a result, some investors like to look at the range of estimates to see if there are any diverging opinions on the company's valuation. The most optimistic Lingyi iTech (Guangdong) analyst has a price target of CN¥8.60 per share, while the most pessimistic values it at CN¥5.90. As you can see, analysts are not all in agreement on the stock's future, but the range of estimates is still reasonably narrow, which could suggest that the outcome is not totally unpredictable.

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. The analysts are definitely expecting Lingyi iTech (Guangdong)'s growth to accelerate, with the forecast 42% annualised growth to the end of 2024 ranking favourably alongside historical growth of 9.9% per annum over the past five years. Compare this with other companies in the same industry, which are forecast to grow their revenue 18% annually. It seems obvious that, while the growth outlook is brighter than the recent past, the analysts also expect Lingyi iTech (Guangdong) to grow faster than 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. Fortunately, they also reconfirmed their revenue numbers, suggesting that it's tracking in line with expectations. Additionally, our data suggests that revenue is expected to grow faster than the wider industry. There was no real change to the consensus price target, suggesting that the intrinsic value of the business has not undergone any major changes with the latest estimates.

With that said, the long-term trajectory of the company's earnings is a lot more important than next year. We have forecasts for Lingyi iTech (Guangdong) going out to 2026, and you can see them free on our platform here.

Plus, you should also learn about the 2 warning signs we've spotted with Lingyi iTech (Guangdong) .

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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.