Guangdong Electric Power Development Co., Ltd. Just Missed EPS By 61%: Here's What Analysts Think Will Happen Next

Investors in Guangdong Electric Power Development Co., Ltd. (SZSE:000539) had a good week, as its shares rose 7.7% to close at CN¥5.31 following the release of its yearly results. Results overall were not great, with earnings of CN¥0.19 per share falling drastically short of analyst expectations. Meanwhile revenues hit CN¥60b and were slightly better than forecasts. 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. We've gathered the most recent statutory forecasts to see whether the analysts have changed their earnings models, following these results.

Check out our latest analysis for Guangdong Electric Power Development

Following the recent earnings report, the consensus from three analysts covering Guangdong Electric Power Development is for revenues of CN¥54.6b in 2024. This implies an uneasy 8.6% decline in revenue compared to the last 12 months. Per-share earnings are expected to bounce 24% to CN¥0.23. Yet prior to the latest earnings, the analysts had been anticipated revenues of CN¥64.1b and earnings per share (EPS) of CN¥0.62 in 2024. It looks like sentiment has declined substantially in the aftermath of these results, with a real cut to revenue estimates and a large cut to earnings per share numbers as well.

The consensus price target fell 29% to CN¥6.51, with the weaker earnings outlook clearly leading valuation estimates.

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. We would highlight that revenue is expected to reverse, with a forecast 8.6% annualised decline to the end of 2024. That is a notable change from historical growth of 19% 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 7.0% per year. It's pretty clear that Guangdong Electric Power Development's revenues are expected to perform substantially worse 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. On the negative side, they also downgraded their revenue estimates, and forecasts imply they will perform worse than the wider industry. The consensus price target fell measurably, with the analysts seemingly not reassured by the latest results, leading to a lower estimate of Guangdong Electric Power Development's future valuation.

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 Guangdong Electric Power Development going out to 2026, and you can see them free on our platform here..

Plus, you should also learn about the 2 warning signs we've spotted with Guangdong Electric Power Development (including 1 which is a bit unpleasant) .

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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.