Analysts Have Lowered Expectations For Angang Steel Company Limited (HKG:347) After Its Latest Results

Shareholders might have noticed that Angang Steel Company Limited (HKG:347) filed its full-year result this time last week. The early response was not positive, with shares down 9.7% to HK$1.30 in the past week. Revenues were CN¥114b, with Angang Steel reporting some 3.1% below analyst expectations. 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. So we gathered the latest post-earnings forecasts to see what estimates suggest is in store for next year.

Check out our latest analysis for Angang Steel

Taking into account the latest results, the eight analysts covering Angang Steel provided consensus estimates of CN¥109.0b revenue in 2024, which would reflect a noticeable 4.0% decline over the past 12 months. Losses are presumed to be contained, narrowing 15% from last year to CN¥0.40, on a statutory basis. In the lead-up to this report, the analysts had been modelling revenues of CN¥119.9b and earnings per share (EPS) of CN¥0.045 in 2024. The analysts have made an abrupt about-face on Angang Steel, administering a small dip in to revenue forecasts and slashing the earnings outlook from a profit to loss.

There was no major change to the consensus price target of HK$2.19, signalling that the business is performing roughly in line with expectations, despite lower earnings per share forecasts. The consensus price target is just an average of individual analyst targets, so - it could be handy to see how wide the range of underlying estimates is. There are some variant perceptions on Angang Steel, with the most bullish analyst valuing it at HK$3.29 and the most bearish at HK$1.55 per share. 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.

Of course, another way to look at these forecasts is to place them into context against the industry itself. These estimates imply that revenue is expected to slow, with a forecast annualised decline of 4.0% by the end of 2024. This indicates a significant reduction from annual growth of 4.8% over the last five years. Compare this with our data, which suggests that other companies in the same industry are, in aggregate, expected to see their revenue grow 6.3% per year. So although its revenues are forecast to shrink, this cloud does not come with a silver lining - Angang Steel is expected to lag the wider industry.

The Bottom Line

The biggest low-light for us was that the forecasts for Angang Steel dropped from profits to a loss next year. 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. The consensus price target held steady at HK$2.19, with the latest estimates not enough to have an impact on their price targets.

With that said, the long-term trajectory of the company's earnings is a lot more important than next year. We have estimates - from multiple Angang Steel analysts - going out to 2026, and you can see them free on our platform here.

You can also see whether Angang Steel is carrying too much debt, and whether its balance sheet is healthy, for 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.