Tingyi (Cayman Islands) Holding Corp. Earnings Missed Analyst Estimates: Here's What Analysts Are Forecasting Now

The analysts might have been a bit too bullish on Tingyi (Cayman Islands) Holding Corp. (HKG:322), given that the company fell short of expectations when it released its yearly results last week. Tingyi (Cayman Islands) Holding missed analyst forecasts, with revenues of CN¥80b and statutory earnings per share (EPS) of CN¥0.55, falling short by 2.7% and 5.8% respectively. The analysts typically update their forecasts at each earnings report, and we can judge from their estimates whether their view of the company has changed or if there are any new concerns to be aware of. We've gathered the most recent statutory forecasts to see whether the analysts have changed their earnings models, following these results.

See our latest analysis for Tingyi (Cayman Islands) Holding

Taking into account the latest results, the current consensus from Tingyi (Cayman Islands) Holding's 21 analysts is for revenues of CN¥84.4b in 2024. This would reflect a credible 5.0% increase on its revenue over the past 12 months. Statutory earnings per share are predicted to ascend 11% to CN¥0.61. In the lead-up to this report, the analysts had been modelling revenues of CN¥86.8b and earnings per share (EPS) of CN¥0.68 in 2024. The analysts seem less optimistic after the recent results, reducing their revenue forecasts and making a real cut to earnings per share numbers.

The analysts made no major changes to their price target of HK$11.41, suggesting the downgrades are not expected to have a long-term impact on Tingyi (Cayman Islands) Holding's valuation. Fixating on a single price target can be unwise though, since the consensus target is effectively the average of analyst price targets. As a result, some investors like to look at the range of estimates to see if there are any diverging opinions on the company's valuation. The most optimistic Tingyi (Cayman Islands) Holding analyst has a price target of HK$15.82 per share, while the most pessimistic values it at HK$8.00. Note the wide gap in analyst price targets? This implies to us that there is a fairly broad range of possible scenarios for the underlying business.

One way to get more context on these forecasts is to look at how they compare to both past performance, and how other companies in the same industry are performing. We would highlight that Tingyi (Cayman Islands) Holding's revenue growth is expected to slow, with the forecast 5.0% annualised growth rate until the end of 2024 being well below the historical 7.2% p.a. growth over the last five years. By way of comparison, the other companies in this industry with analyst coverage are forecast to grow their revenue at 7.9% per year. Factoring in the forecast slowdown in growth, it seems obvious that Tingyi (Cayman Islands) Holding is also expected to grow slower than other industry participants.

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. Unfortunately, they also downgraded their revenue estimates, and our data indicates underperformance compared to the wider industry. Even so, earnings per share are more important to the intrinsic value of the business. 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.

Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. We have forecasts for Tingyi (Cayman Islands) Holding going out to 2026, and you can see them free on our platform here.

Don't forget that there may still be risks. For instance, we've identified 1 warning sign for Tingyi (Cayman Islands) Holding that you should be aware of.

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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.