Analysts Are More Bearish On Kyland Technology Co., Ltd. (SZSE:300353) Than They Used To Be

Market forces rained on the parade of Kyland Technology Co., Ltd. (SZSE:300353) shareholders today, when the analysts downgraded their forecasts for this year. Revenue and earnings per share (EPS) forecasts were both revised downwards, with analysts seeing grey clouds on the horizon.

Following the downgrade, the current consensus from Kyland Technology's dual analysts is for revenues of CN¥1.5b in 2024 which - if met - would reflect a huge 30% increase on its sales over the past 12 months. Statutory earnings per share are anticipated to plummet 63% to CN¥0.14 in the same period. Previously, the analysts had been modelling revenues of CN¥1.9b and earnings per share (EPS) of CN¥0.29 in 2024. Indeed, we can see that the analysts are a lot more bearish about Kyland Technology's prospects, administering a sizeable cut to revenue estimates and slashing their EPS estimates to boot.

Check out our latest analysis for Kyland Technology

Analysts made no major changes to their price target of CN¥12.97, suggesting the downgrades are not expected to have a long-term impact on Kyland Technology's valuation.

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 Kyland Technology's rate of growth is expected to accelerate meaningfully, with the forecast 30% annualised revenue growth to the end of 2024 noticeably faster than its historical growth of 9.4% p.a. 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 21% per year. It seems obvious that, while the growth outlook is brighter than the recent past, the analysts also expect Kyland Technology to grow faster than the wider 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 Kyland Technology. While analysts did downgrade their revenue estimates, these forecasts still imply revenues will perform better than the wider market. We're also surprised to see that the price target went unchanged. Still, deteriorating business conditions (assuming accurate forecasts!) can be a leading indicator for the stock price, so we wouldn't blame investors for being more cautious on Kyland Technology after the downgrade.

So things certainly aren't looking great, and you should also know that we've spotted some potential warning signs with Kyland Technology, including dilutive stock issuance over the past year. Learn more, and discover the 1 other flag we've identified, for 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.