Time To Worry? Analysts Are Downgrading Their Jilin Electric Power Co.,Ltd. (SZSE:000875) Outlook

Today is shaping up negative for Jilin Electric Power Co.,Ltd. (SZSE:000875) shareholders, with the analysts delivering a substantial negative revision to this year's forecasts. Both revenue and earnings per share (EPS) estimates were cut sharply as analysts factored in the latest outlook for the business, concluding that they were too optimistic previously. Shares are up 6.1% to CN¥5.03 in the past week. We'd be curious to see if the downgrade is enough to reverse investor sentiment on the business.

Following the downgrade, the current consensus from Jilin Electric PowerLtd's three analysts is for revenues of CN¥16b in 2024 which - if met - would reflect a meaningful 9.0% increase on its sales over the past 12 months. Statutory earnings per share are presumed to climb 19% to CN¥0.43. Prior to this update, the analysts had been forecasting revenues of CN¥18b and earnings per share (EPS) of CN¥0.53 in 2024. Indeed, we can see that the analysts are a lot more bearish about Jilin Electric PowerLtd's prospects, administering a measurable cut to revenue estimates and slashing their EPS estimates to boot.

View our latest analysis for Jilin Electric PowerLtd

Of course, another way to look at these forecasts is to place them into context against the industry itself. We would highlight that Jilin Electric PowerLtd's revenue growth is expected to slow, with the forecast 9.0% annualised growth rate until the end of 2024 being well below the historical 15% p.a. growth over the last five years. Juxtapose this against the other companies in the industry with analyst coverage, which are forecast to grow their revenues (in aggregate) 7.1% per year. Even after the forecast slowdown in growth, it seems obvious that Jilin Electric PowerLtd is also expected to grow faster than the wider industry.

The Bottom Line

The biggest issue in the new estimates is that analysts have reduced their earnings per share estimates, suggesting business headwinds lay ahead for Jilin Electric PowerLtd. Unfortunately, analysts also downgraded their revenue estimates, although our data indicates revenues are expected to perform better than the wider market. We wouldn't be surprised to find shareholders feeling a bit shell-shocked, after these downgrades. It looks like analysts have become a lot more bearish on Jilin Electric PowerLtd, and their negativity could be grounds for caution.

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 Jilin Electric PowerLtd going out to 2026, and you can see them free on our platform here.

Another way to search for interesting companies that could be reaching an inflection point is to track whether management are buying or selling, with our free list of growing companies that insiders are buying.

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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.