Analysts Are More Bearish On Shanghai International Port (Group) Co., Ltd. (SHSE:600018) Than They Used To Be

Market forces rained on the parade of Shanghai International Port (Group) Co., Ltd. (SHSE:600018) shareholders today, when the analysts downgraded their forecasts for this year. Both revenue and earnings per share (EPS) estimates were cut sharply as the analysts factored in the latest outlook for the business, concluding that they were too optimistic previously.

Following the latest downgrade, the current consensus, from the two analysts covering Shanghai International Port (Group), is for revenues of CN¥36b in 2025, which would reflect a measurable 5.1% reduction in Shanghai International Port (Group)'s sales over the past 12 months. Statutory earnings per share are supposed to drop 14% to CN¥0.54 in the same period. Prior to this update, the analysts had been forecasting revenues of CN¥41b and earnings per share (EPS) of CN¥0.61 in 2025. Indeed, we can see that the analysts are a lot more bearish about Shanghai International Port (Group)'s prospects, administering a substantial drop in revenue estimates and slashing their EPS estimates to boot.

Check out our latest analysis for Shanghai International Port (Group)

Analysts made no major changes to their price target of CN¥5.80, suggesting the downgrades are not expected to have a long-term impact on Shanghai International Port (Group)'s valuation.

Another way we can view these estimates is in the context of the bigger picture, such as how the forecasts stack up against past performance, and whether forecasts are more or less bullish relative to other companies in the industry. These estimates imply that sales are expected to slow, with a forecast annualised revenue decline of 5.1% by the end of 2025. This indicates a significant reduction from annual growth of 5.1% over the last five years. Compare this with our data, which suggests that other companies in the same industry are, in aggregate, expected to see their revenue grow 5.3% per year. It's pretty clear that Shanghai International Port (Group)'s revenues are expected to perform substantially worse than the wider industry.

The Bottom Line

The most important thing to take away is that analysts cut their earnings per share estimates, expecting a clear decline in business conditions. Regrettably, they also downgraded their revenue estimates, and the latest forecasts imply the business will grow sales slower 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 Shanghai International Port (Group) after the downgrade.

Unfortunately, by using these new estimates as a starting point, we've run a discounted cash flow calculation (DCF) on Shanghai International Port (Group) that suggests the company could be somewhat overvalued. Learn why, and examine the assumptions that underpin our valuation by visiting our free platform here to learn more about our valuation approach.

Of course, seeing company management invest large sums of money in a stock can be just as useful as knowing whether analysts are downgrading their estimates. So you may also wish to search this free list of stocks with high insider ownership.

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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.