Earnings Miss: Xiamen Xiangyu Co., Ltd. Missed EPS By 25% And Analysts Are Revising Their Forecasts

As you might know, Xiamen Xiangyu Co., Ltd. (SHSE:600057) last week released its latest annual, and things did not turn out so great for shareholders. Unfortunately, Xiamen Xiangyu delivered a serious earnings miss. Revenues of CN¥459b were 13% below expectations, and statutory earnings per share of CN¥0.63 missed estimates by 25%. Following the result, the analysts have updated their earnings model, and it would be good to know whether they think there's been a strong change in the company's prospects, or if it's business as usual. With this in mind, we've gathered the latest statutory forecasts to see what the analysts are expecting for next year.

View our latest analysis for Xiamen Xiangyu

Following the latest results, Xiamen Xiangyu's four analysts are now forecasting revenues of CN¥542.0b in 2024. This would be a decent 18% improvement in revenue compared to the last 12 months. Statutory earnings per share are predicted to bounce 49% to CN¥1.03. Yet prior to the latest earnings, the analysts had been anticipated revenues of CN¥590.0b and earnings per share (EPS) of CN¥1.15 in 2024. The analysts seem less optimistic after the recent results, reducing their revenue forecasts and making a substantial drop in earnings per share numbers.

It'll come as no surprise then, to learn that the analysts have cut their price target 33% to CN¥7.75.

Taking a look at the bigger picture now, one of the ways we can understand these forecasts is to see how they compare to both past performance and industry growth estimates. The period to the end of 2024 brings more of the same, according to the analysts, with revenue forecast to display 18% growth on an annualised basis. That is in line with its 17% annual growth over the past five years. Compare this with the broader industry, which analyst estimates (in aggregate) suggest will see revenues grow 10% annually. So although Xiamen Xiangyu is expected to maintain its revenue growth rate, it's definitely expected 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. Regrettably, they also downgraded their revenue estimates, but the latest forecasts still imply the business will grow faster than the wider industry. Furthermore, the analysts also cut their price targets, suggesting that the latest news has led to greater pessimism about the intrinsic value of the business.

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 Xiamen Xiangyu going out to 2026, and you can see them free on our platform here.

You should always think about risks though. Case in point, we've spotted 3 warning signs for Xiamen Xiangyu you should be aware of.

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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.