The Consensus EPS Estimates For CanSino Biologics Inc. (HKG:6185) Just Fell Dramatically

The analysts covering CanSino Biologics Inc. (HKG:6185) delivered a dose of negativity to shareholders today, by making a substantial revision to their statutory forecasts for this year. Both revenue and earnings per share (EPS) forecasts went under the knife, suggesting the analysts have soured majorly on the business.

Following the downgrade, the current consensus from CanSino Biologics' five analysts is for revenues of CN¥858m in 2024 which - if met - would reflect a sizeable 140% increase on its sales over the past 12 months. Losses are predicted to fall substantially, shrinking 76% to CN¥1.42 per share. Yet before this consensus update, the analysts had been forecasting revenues of CN¥958m and losses of CN¥1.27 per share in 2024. Ergo, there's been a clear change in sentiment, with the analysts administering a notable cut to this year's revenue estimates, while at the same time increasing their loss per share forecasts.

View our latest analysis for CanSino Biologics

The consensus price target fell 18% to CN¥24.32, implicitly signalling that lower earnings per share are a leading indicator for CanSino Biologics' valuation. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. There are some variant perceptions on CanSino Biologics, with the most bullish analyst valuing it at CN¥38.36 and the most bearish at CN¥17.09 per share. This is a fairly broad spread of estimates, suggesting that the analysts are forecasting a wide range of possible outcomes for the 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. It's clear from the latest estimates that CanSino Biologics' rate of growth is expected to accelerate meaningfully, with the forecast 140% annualised revenue growth to the end of 2024 noticeably faster than its historical growth of 33% p.a. over the past five years. Compare this with other companies in the same industry, which are forecast to grow their revenue 26% annually. Factoring in the forecast acceleration in revenue, it's pretty clear that CanSino Biologics is expected to grow much faster than its industry.

The Bottom Line

The most important thing to take away is that analysts increased their loss per share estimates for this year. Unfortunately, analysts also downgraded their revenue estimates, although our data indicates revenues are expected to perform better than the wider market. With a serious cut to this year's expectations and a falling price target, we wouldn't be surprised if investors were becoming wary of CanSino Biologics.

Even so, the longer term trajectory of the business is much more important for the value creation of shareholders. We have estimates - from multiple CanSino Biologics analysts - going out to 2026, and you can see them free on our platform here.

Another way to search for interesting companies that could be reaching an inflection point is to track whether management are buying or selling, with our free list of growing companies that insiders are buying.

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.