This China Bohai Bank Co., Ltd. (HKG:9668) Analyst Is Way More Bearish Than They Used To Be

One thing we could say about the covering analyst on China Bohai Bank Co., Ltd. (HKG:9668) - they aren't optimistic, having just made a major negative revision to their near-term (statutory) forecasts for the organization. Both revenue and earnings per share (EPS) estimates were cut sharply as the analyst factored in the latest outlook for the business, concluding that they were too optimistic previously.

After the downgrade, the lone analyst covering China Bohai Bank is now predicting revenues of CN¥30b in 2022. If met, this would reflect a major 48% improvement in sales compared to the last 12 months. Statutory earnings per share are expected to be CN¥0.44, roughly flat on the last 12 months. Previously, the analyst had been modelling revenues of CN¥38b and earnings per share (EPS) of CN¥0.63 in 2022. Indeed, we can see that the analyst is a lot more bearish about China Bohai Bank's prospects, administering a measurable cut to revenue estimates and slashing their EPS estimates to boot.

View our latest analysis for China Bohai Bank

It'll come as no surprise then, to learn that the analyst has cut their price target 66% to CN¥1.05.

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. It's clear from the latest estimates that China Bohai Bank's rate of growth is expected to accelerate meaningfully, with the forecast 48% annualised revenue growth to the end of 2022 noticeably faster than its historical growth of 3.7% p.a. 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 9.2% per year. It seems obvious that, while the growth outlook is brighter than the recent past, the analyst also expect China Bohai Bank to grow faster than the wider industry.

The Bottom Line

The most important thing to take away is that the analyst cut their earnings per share estimates, expecting a clear decline in business conditions. Unfortunately, the analyst also downgraded their revenue estimates, although our data indicates revenues are expected to perform better than the wider market. With a serious cut to this year's expectations and a falling price target, we wouldn't be surprised if investors were becoming wary of China Bohai Bank.

Even so, the longer term trajectory of the business is much more important for the value creation of shareholders. At least one analyst has provided forecasts out to 2024, which can be seen for free on our platform here.

Of course, seeing company management invest large sums of money in a stock can be just as useful as knowing whether analysts are downgrading their estimates. So you may also wish to search this free list of stocks 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.