Onewo Inc. Just Missed Revenue By 6.3%: Here's What Analysts Think Will Happen Next

It's been a good week for Onewo Inc. (HKG:2602) shareholders, because the company has just released its latest full-year results, and the shares gained 5.0% to HK$19.66. Revenues came in 6.3% below expectations, at CN¥33b. Statutory earnings per share were relatively better off, with a per-share profit of CN¥1.66 being roughly in line with analyst estimates. Following the result, the analysts have updated their earnings model, and it would be good to know whether they think there's been a strong change in the company's prospects, or if it's business as usual. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether the analysts have changed their mind on Onewo after the latest results.

View our latest analysis for Onewo

Following the latest results, Onewo's 14 analysts are now forecasting revenues of CN¥36.6b in 2024. This would be a meaningful 10% improvement in revenue compared to the last 12 months. Statutory earnings per share are predicted to bounce 22% to CN¥2.03. In the lead-up to this report, the analysts had been modelling revenues of CN¥41.2b and earnings per share (EPS) of CN¥2.05 in 2024. So there's been a clear change in sentiment after these results, with the analysts making a real cut to revenues and reconfirming their earnings per share estimates.

It will come as no surprise then, that the consensus price target fell 6.1% to HK$33.65following these changes. 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. Currently, the most bullish analyst values Onewo at HK$53.76 per share, while the most bearish prices it at HK$25.06. This is a fairly broad spread of estimates, suggesting that analysts are forecasting a wide range of possible outcomes for the business.

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Onewo's past performance and to peers in the same industry. We would highlight that Onewo's revenue growth is expected to slow, with the forecast 10% annualised growth rate until the end of 2024 being well below the historical 18% p.a. growth over the last three years. Juxtapose this against the other companies in the industry with analyst coverage, which are forecast to grow their revenues (in aggregate) 7.0% per year. Even after the forecast slowdown in growth, it seems obvious that Onewo is also expected to grow faster than the wider industry.

The Bottom Line

The most important thing to take away is that there's been no major change in sentiment, with the analysts reconfirming that the business is performing in line with their previous earnings per share estimates. They also downgraded Onewo's revenue estimates, but industry data suggests that it is expected to grow faster than the wider industry. Even so, earnings per share are more important to the intrinsic value of the business. The consensus price target fell measurably, with the analysts seemingly not reassured by the latest results, leading to a lower estimate of Onewo's future valuation.

Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. At Simply Wall St, we have a full range of analyst estimates for Onewo going out to 2026, and you can see them free on our platform here..

Plus, you should also learn about the 1 warning sign we've spotted with Onewo .

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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.