Earnings Miss: SDIC Power Holdings Co., Ltd Missed EPS By 16% And Analysts Are Revising Their Forecasts

As you might know, SDIC Power Holdings Co., Ltd (SHSE:600886) last week released its latest quarterly, and things did not turn out so great for shareholders. It wasn't a great result overall - while revenue fell marginally short of analyst estimates at CN¥13b, statutory earnings missed forecasts by 16%, coming in at just CN¥0.22 per share. 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 thought readers would find it interesting to see the analysts latest (statutory) post-earnings forecasts for next year.

See our latest analysis for SDIC Power Holdings

Taking into account the latest results, the current consensus from SDIC Power Holdings' ten analysts is for revenues of CN¥61.4b in 2024. This would reflect a credible 6.8% increase on its revenue over the past 12 months. Statutory earnings per share are predicted to swell 11% to CN¥1.05. Before this earnings report, the analysts had been forecasting revenues of CN¥61.3b and earnings per share (EPS) of CN¥1.08 in 2024. So it looks like there's been a small decline in overall sentiment after the recent results - there's been no major change to revenue estimates, but the analysts did make a small dip in their earnings per share forecasts.

The consensus price target held steady at CN¥17.70, with the analysts seemingly voting that their lower forecast earnings are not expected to lead to a lower stock price in the foreseeable future. There's another way to think about price targets though, and that's to look at the range of price targets put forward by analysts, because a wide range of estimates could suggest a diverse view on possible outcomes for the business. Currently, the most bullish analyst values SDIC Power Holdings at CN¥22.10 per share, while the most bearish prices it at CN¥9.64. 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.

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. The analysts are definitely expecting SDIC Power Holdings' growth to accelerate, with the forecast 14% annualised growth to the end of 2024 ranking favourably alongside historical growth of 8.1% per annum 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 6.5% per year. Factoring in the forecast acceleration in revenue, it's pretty clear that SDIC Power Holdings is expected to grow much faster than its industry.

The Bottom Line

The biggest concern is that the analysts reduced their earnings per share estimates, suggesting business headwinds could lay ahead for SDIC Power Holdings. Happily, there were no major changes to revenue forecasts, with the business still 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.

Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. At Simply Wall St, we have a full range of analyst estimates for SDIC Power Holdings going out to 2026, and you can see them free on our platform here..

Don't forget that there may still be risks. For instance, we've identified 2 warning signs for SDIC Power Holdings (1 can't be ignored) 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.