COSCO SHIPPING Holdings Co., Ltd. (HKG:1919) Consensus Forecasts Have Become A Little Darker Since Its Latest Report

COSCO SHIPPING Holdings Co., Ltd. (HKG:1919) came out with its half-yearly results last week, and we wanted to see how the business is performing and what industry forecasters think of the company following this report. Revenues came in 3.0% below expectations, at CN¥92b. Statutory earnings per share were relatively better off, with a per-share profit of CN¥6.77 being roughly in line with analyst estimates. 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. With this in mind, we've gathered the latest statutory forecasts to see what the analysts are expecting for next year.

Check out our latest analysis for COSCO SHIPPING Holdings

Taking into account the latest results, the current consensus, from the nine analysts covering COSCO SHIPPING Holdings, is for revenues of CN¥196.1b in 2023. This implies a discernible 6.2% reduction in COSCO SHIPPING Holdings' revenue over the past 12 months. Statutory earnings per share are expected to crater 36% to CN¥1.37 in the same period. In the lead-up to this report, the analysts had been modelling revenues of CN¥206.6b and earnings per share (EPS) of CN¥1.47 in 2023. It's pretty clear that pessimism has reared its head after the latest results, leading to a weaker revenue outlook and a small dip in earnings per share estimates.

The analysts made no major changes to their price target of HK$8.44, suggesting the downgrades are not expected to have a long-term impact on COSCO SHIPPING Holdings' 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. The most optimistic COSCO SHIPPING Holdings analyst has a price target of HK$10.00 per share, while the most pessimistic values it at HK$5.37. Analysts definitely have varying views on the business, but the spread of estimates is not wide enough in our view to suggest that extreme outcomes could await COSCO SHIPPING Holdings shareholders.

Another way we can view these estimates is in the context of the bigger picture, such as how the forecasts stack up against past performance, and whether forecasts are more or less bullish relative to other companies in the industry. These estimates imply that revenue is expected to slow, with a forecast annualised decline of 12% by the end of 2023. This indicates a significant reduction from annual growth of 23% over the last five years. By contrast, our data suggests that other companies (with analyst coverage) in the industry are forecast to see their revenue decline 6.2% annually for the foreseeable future. The forecasts do look bearish for COSCO SHIPPING Holdings, since they're expecting it to shrink faster than the industry.

The Bottom Line

The most important thing to take away is that the analysts downgraded their earnings per share estimates, showing that there has been a clear decline in sentiment following these results. Unfortunately they also downgraded their revenue estimates, and our analysts estimates suggest that COSCO SHIPPING Holdings is still expected to perform worse than the wider industry. There was no real change to the consensus price target, suggesting that the intrinsic value of the business has not undergone any major changes with the latest estimates.

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 COSCO SHIPPING Holdings going out to 2025, and you can see them free on our platform here..

You should always think about risks though. Case in point, we've spotted 3 warning signs for COSCO SHIPPING Holdings you should be aware of, and 1 of them is a bit unpleasant.

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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.