The Xinte Energy Co., Ltd. (HKG:1799) Full-Year Results Are Out And Analysts Have Published New Forecasts

Last week saw the newest yearly earnings release from Xinte Energy Co., Ltd. (HKG:1799), an important milestone in the company's journey to build a stronger business. Results were roughly in line with estimates, with revenues of CN¥38b and statutory earnings per share of CN¥9.37. 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. With this in mind, we've gathered the latest statutory forecasts to see what the analysts are expecting for next year.

See our latest analysis for Xinte Energy

Taking into account the latest results, the current consensus from Xinte Energy's six analysts is for revenues of CN¥40.2b in 2023, which would reflect a satisfactory 7.1% increase on its sales over the past 12 months. Statutory earnings per share are forecast to decline 13% to CN¥8.12 in the same period. Yet prior to the latest earnings, the analysts had been anticipated revenues of CN¥40.2b and earnings per share (EPS) of CN¥8.08 in 2023. 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.

It will come as no surprise then, to learn that the consensus price target is largely unchanged at HK$22.71. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. The most optimistic Xinte Energy analyst has a price target of HK$31.80 per share, while the most pessimistic values it at HK$14.20. This is a fairly broad spread of estimates, suggesting that analysts are forecasting a wide range of possible outcomes for the business.

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 pretty clear that there is an expectation that Xinte Energy's revenue growth will slow down substantially, with revenues to the end of 2023 expected to display 7.1% growth on an annualised basis. This is compared to a historical growth rate of 28% over the past five years. By way of comparison, the other companies in this industry with analyst coverage are forecast to grow their revenue at 11% per year. Factoring in the forecast slowdown in growth, it seems obvious that Xinte Energy is also expected to grow slower than other industry participants.

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. On the plus side, there were no major changes to revenue estimates; although forecasts imply revenues will perform worse 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.

With that in mind, we wouldn't be too quick to come to a conclusion on Xinte Energy. Long-term earnings power is much more important than next year's profits. We have forecasts for Xinte Energy going out to 2025, and you can see them free on our platform here.

You still need to take note of risks, for example - Xinte Energy has 1 warning sign we think you should be aware of.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

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.