China Yangtze Power Co., Ltd. Just Missed Revenue By 24%: Here's What Analysts Think Will Happen Next

It's shaping up to be a tough period for China Yangtze Power Co., Ltd. (SHSE:600900), which a week ago released some disappointing first-quarter results that could have a notable impact on how the market views the stock. Earnings missed expectations fairly severely, with revenues arriving 24% shy of expectations at just CN¥16b. Per-share statutory earnings were CN¥0.16, missing analyst predictions by 15%. 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. We thought readers would find it interesting to see the analysts latest (statutory) post-earnings forecasts for next year.

See our latest analysis for China Yangtze Power

Taking into account the latest results, the most recent consensus for China Yangtze Power from 20 analysts is for revenues of CN¥87.8b in 2024. If met, it would imply a decent 12% increase on its revenue over the past 12 months. Statutory earnings per share are predicted to soar 23% to CN¥1.39. Before this earnings report, the analysts had been forecasting revenues of CN¥88.0b and earnings per share (EPS) of CN¥1.41 in 2024. So it's pretty clear that, although the analysts have updated their estimates, there's been no major change in expectations for the business following the latest results.

There were no changes to revenue or earnings estimates or the price target of CN¥28.74, suggesting that the company has met expectations in its recent result. 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. There are some variant perceptions on China Yangtze Power, with the most bullish analyst valuing it at CN¥31.19 and the most bearish at CN¥24.20 per share. With such a narrow range of valuations, the analysts apparently share similar views on what they think the business is worth.

Of course, another way to look at these forecasts is to place them into context against the industry itself. The analysts are definitely expecting China Yangtze Power's growth to accelerate, with the forecast 16% annualised growth to the end of 2024 ranking favourably alongside historical growth of 6.2% 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 7.0% per year. It seems obvious that, while the growth outlook is brighter than the recent past, the analysts also expect China Yangtze Power to grow faster than the wider industry.

The Bottom Line

The most obvious conclusion is that there's been no major change in the business' prospects in recent times, with the analysts holding their earnings forecasts steady, in line with previous estimates. Happily, there were no major changes to revenue forecasts, with the business still expected to grow faster than the wider industry. The consensus price target held steady at CN¥28.74, with the latest estimates not enough to have an impact on their price targets.

With that said, the long-term trajectory of the company's earnings is a lot more important than next year. At Simply Wall St, we have a full range of analyst estimates for China Yangtze Power going out to 2026, and you can see them free on our platform here..

We don't want to rain on the parade too much, but we did also find 1 warning sign for China Yangtze Power that you need to be mindful 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.