Bloks Group Limited (HKG:325) Analysts Just Cut Their EPS Forecasts Substantially

The latest analyst coverage could presage a bad day for Bloks Group Limited (HKG:325), with the analysts making across-the-board cuts to their statutory estimates that might leave shareholders a little shell-shocked. Revenue and earnings per share (EPS) forecasts were both revised downwards, with analysts seeing grey clouds on the horizon.

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Following the downgrade, the latest consensus from Bloks Group's twelve analysts is for revenues of CN¥3.3b in 2025, which would reflect a huge 32% improvement in sales compared to the last 12 months. Statutory earnings per share are presumed to surge 360% to CN¥2.83. Before this latest update, the analysts had been forecasting revenues of CN¥4.1b and earnings per share (EPS) of CN¥3.89 in 2025. Indeed, we can see that the analysts are a lot more bearish about Bloks Group's prospects, administering a measurable cut to revenue estimates and slashing their EPS estimates to boot.

See our latest analysis for Bloks Group

The consensus price target fell 17% to CN¥123, with the weaker earnings outlook clearly leading analyst valuation estimates. There's another way to think about price targets though, and that's to look at the range of price targets put forward by analysts, because a wide range of estimates could suggest a diverse view on possible outcomes for the business. There are some variant perceptions on Bloks Group, with the most bullish analyst valuing it at CN¥158 and the most bearish at CN¥97.03 per share. Analysts definitely have varying views on the business, but the spread of estimates is not wide enough in our view to suggest that extreme outcomes could await Bloks Group shareholders.

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. The analysts are definitely expecting Bloks Group's growth to accelerate, with the forecast 74% annualised growth to the end of 2025 ranking favourably alongside historical growth of 57% per annum over the past year. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to grow their revenue at 8.4% per year. It seems obvious that, while the growth outlook is brighter than the recent past, the analysts also expect Bloks Group to grow faster than the wider industry.

The Bottom Line

The most important thing to take away is that analysts cut their earnings per share estimates, expecting a clear decline in business conditions. While analysts did downgrade their revenue estimates, these forecasts still imply revenues will perform better than the wider market. Given the scope of the downgrades, it would not be a surprise to see the market become more wary of the business.

Still, the long-term prospects of the business are much more relevant than next year's earnings. We have estimates - from multiple Bloks Group analysts - going out to 2027, and you can see them free on our platform here.

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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.