Earnings Report: ZJLD Group Inc Missed Revenue Estimates By 16%

ZJLD Group Inc (HKG:6979) last week reported its latest interim results, which makes it a good time for investors to dive in and see if the business is performing in line with expectations. Revenues were CN¥2.5b, 16% below analyst expectations, although losses didn't appear to worsen significantly, with a per-share statutory loss of CN¥0.40 being in line with what the analysts forecast. This is an important time for investors, as they can track a company's performance in its report, look at what experts are forecasting for next year, and see if there has been any change to expectations for the business. So we gathered the latest post-earnings forecasts to see what estimates suggest is in store for next year.

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Following last week's earnings report, ZJLD Group's nine analysts are forecasting 2025 revenues to be CN¥5.39b, approximately in line with the last 12 months. Statutory earnings per share are predicted to increase 6.4% to CN¥0.36. Yet prior to the latest earnings, the analysts had been anticipated revenues of CN¥6.38b and earnings per share (EPS) of CN¥0.38 in 2025. It looks like sentiment has fallen somewhat in the aftermath of these results, with a real cut to revenue estimates and a minor downgrade to earnings per share numbers as well.

Check out our latest analysis for ZJLD Group

The average price target climbed 7.3% to HK$8.88despite the reduced earnings forecasts, suggesting that this earnings impact could be a positive for the stock, once it passes. 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. Currently, the most bullish analyst values ZJLD Group at HK$12.26 per share, while the most bearish prices it at HK$5.99. 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.

Taking a look at the bigger picture now, one of the ways we can understand these forecasts is to see how they compare to both past performance and industry growth estimates. We would also point out that the forecast 1.4% annualised revenue decline to the end of 2025 is better than the historical trend, which saw revenues shrink 29% annually over the past year By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to see their revenue grow 8.7% per year. So while a broad number of companies are forecast to grow, unfortunately ZJLD Group is expected to see its revenue affected worse than other companies in the industry.

The Bottom Line

The biggest concern is that the analysts reduced their earnings per share estimates, suggesting business headwinds could lay ahead for ZJLD Group. On the negative side, they also downgraded their revenue estimates, and forecasts imply they will perform worse than the wider industry. There was also a nice increase in the price target, with the analysts clearly feeling that the intrinsic value of the business is improving.

Following on from that line of thought, we think that the long-term prospects of the business are much more relevant than next year's earnings. We have forecasts for ZJLD Group going out to 2027, and you can see them free on our platform here.

Another thing to consider is whether management and directors have been buying or selling stock recently. We provide an overview of all open market stock trades for the last twelve months 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.