Guangzhou Baiyun International Airport Company Limited Just Missed Earnings And Its Revenue Numbers Were Weaker Than Expected

Guangzhou Baiyun International Airport Company Limited (SHSE:600004) just released its latest first-quarter report and things are not looking great. Earnings fell badly short of analyst estimates, with CN¥1.7b revenues missing by 16%, and statutory earnings per share (EPS) of CN¥0.08 falling short of forecasts by some -11%. Earnings are an important time for investors, as they can track a company's performance, look at what the analysts are forecasting for next year, and see if there's been a change in sentiment towards the company. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether the analysts have changed their mind on Guangzhou Baiyun International Airport after the latest results.

Check out our latest analysis for Guangzhou Baiyun International Airport

After the latest results, the eleven analysts covering Guangzhou Baiyun International Airport are now predicting revenues of CN¥7.68b in 2024. If met, this would reflect a meaningful 14% improvement in revenue compared to the last 12 months. Per-share earnings are expected to shoot up 88% to CN¥0.46. In the lead-up to this report, the analysts had been modelling revenues of CN¥8.03b and earnings per share (EPS) of CN¥0.49 in 2024. The analysts are less bullish than they were before these results, given the reduced revenue forecasts and the minor downgrade to earnings per share expectations.

The analysts made no major changes to their price target of CN¥13.33, suggesting the downgrades are not expected to have a long-term impact on Guangzhou Baiyun International Airport's valuation. 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 Guangzhou Baiyun International Airport analyst has a price target of CN¥20.00 per share, while the most pessimistic values it at CN¥9.10. 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.

Looking at the bigger picture now, one of the ways we can make sense of these forecasts is to see how they measure up against both past performance and industry growth estimates. For example, we noticed that Guangzhou Baiyun International Airport's rate of growth is expected to accelerate meaningfully, with revenues forecast to exhibit 19% growth to the end of 2024 on an annualised basis. That is well above its historical decline of 9.7% a year over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in the industry are forecast to see their revenue grow 7.2% per year. So it looks like Guangzhou Baiyun International Airport is expected to grow faster than its competitors, at least for a while.

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 downgraded Guangzhou Baiyun International Airport's revenue estimates, but industry data suggests that it 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 in mind, we wouldn't be too quick to come to a conclusion on Guangzhou Baiyun International Airport. Long-term earnings power is much more important than next year's profits. We have forecasts for Guangzhou Baiyun International Airport going out to 2026, and you can see them free on our platform here.

However, before you get too enthused, we've discovered 1 warning sign for Guangzhou Baiyun International Airport that you should be aware of.

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.