Earnings Update: Kingdee International Software Group Company Limited (HKG:268) Just Reported And Analysts Are Trimming Their Forecasts

The analysts might have been a bit too bullish on Kingdee International Software Group Company Limited (HKG:268), given that the company fell short of expectations when it released its annual results last week. Revenues missed expectations somewhat, coming in at CN¥6.3b, but statutory earnings fell catastrophically short, with a loss of CN¥0.04 some 95% larger than what the analysts had predicted. Earnings are an important time for investors, as they can track a company's performance, look at what the analysts are forecasting for next year, and see if there's been a change in sentiment towards the company. With this in mind, we've gathered the latest statutory forecasts to see what the analysts are expecting for next year.

See our latest analysis for Kingdee International Software Group

Following the latest results, Kingdee International Software Group's 23 analysts are now forecasting revenues of CN¥7.10b in 2025. This would be a decent 13% improvement in revenue compared to the last 12 months. Kingdee International Software Group is also expected to turn profitable, with statutory earnings of CN¥0.047 per share. In the lead-up to this report, the analysts had been modelling revenues of CN¥7.58b and earnings per share (EPS) of CN¥0.054 in 2025. From this we can that sentiment has definitely become more bearish after the latest results, leading to lower revenue forecasts and a real cut to earnings per share estimates.

Trump has pledged to "unleash" American oil and gas and these 15 US stocks have developments that are poised to benefit.

The average price target climbed 37% to HK$15.76despite the reduced earnings forecasts, suggesting that this earnings impact could be a positive for the stock, once it passes. 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. There are some variant perceptions on Kingdee International Software Group, with the most bullish analyst valuing it at HK$19.29 and the most bearish at HK$7.91 per share. This is a fairly broad spread of estimates, suggesting that analysts are forecasting a wide range of possible outcomes for the business.

Looking at the bigger picture now, one of the ways we can make sense of these forecasts is to see how they measure up against both past performance and industry growth estimates. The period to the end of 2025 brings more of the same, according to the analysts, with revenue forecast to display 13% growth on an annualised basis. That is in line with its 15% annual growth over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to see their revenues grow 19% per year. So it's pretty clear that Kingdee International Software Group is expected to grow slower than similar companies in the same industry.

The Bottom Line

The biggest concern is that the analysts reduced their earnings per share estimates, suggesting business headwinds could lay ahead for Kingdee International Software Group. 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 also a nice increase in the price target, with the analysts clearly feeling that the intrinsic value of the business is improving.

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 Kingdee International Software Group going out to 2027, and you can see them free on our platform here..

That said, it's still necessary to consider the ever-present spectre of investment risk. We've identified 1 warning sign with Kingdee International Software Group , and understanding this should be part of your investment process.

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.