COSCO SHIPPING Holdings Co., Ltd. Just Missed Earnings And Its Revenue Numbers Were Weaker Than Expected

It's been a good week for COSCO SHIPPING Holdings Co., Ltd. (HKG:1919) shareholders, because the company has just released its latest interim results, and the shares gained 2.1% to HK$10.70. Revenues were CN¥101b, 15% below analyst expectations, although losses didn't appear to worsen significantly, with a per-share statutory loss of CN¥1.48 being in line with what the analysts forecast. 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. We thought readers would find it interesting to see the analysts latest (statutory) post-earnings forecasts for next year.

View our latest analysis for COSCO SHIPPING Holdings

Taking into account the latest results, the most recent consensus for COSCO SHIPPING Holdings from ten analysts is for revenues of CN¥220.8b in 2024. If met, it would imply a notable 20% increase on its revenue over the past 12 months. Per-share earnings are expected to surge 44% to CN¥2.18. Yet prior to the latest earnings, the analysts had been anticipated revenues of CN¥224.4b and earnings per share (EPS) of CN¥2.21 in 2024. So it's pretty clear that, although the analysts have updated their estimates, there's been no major change in expectations for the business following the latest results.

The consensus price target fell 5.7% to HK$12.44, suggesting that the analysts might have been a bit enthusiastic in their previous valuation - or they were expecting the company to provide stronger guidance in the semi-annual results. Fixating on a single price target can be unwise though, since the consensus target is effectively the average of analyst price targets. As a result, some investors like to look at the range of estimates to see if there are any diverging opinions on the company's valuation. There are some variant perceptions on COSCO SHIPPING Holdings, with the most bullish analyst valuing it at HK$18.02 and the most bearish at HK$8.18 per share. This is a fairly broad spread of estimates, suggesting that analysts are forecasting a wide range of possible outcomes for the business.

Of course, another way to look at these forecasts is to place them into context against the industry itself. The analysts are definitely expecting COSCO SHIPPING Holdings' growth to accelerate, with the forecast 43% annualised growth to the end of 2024 ranking favourably alongside historical growth of 10% per annum over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in the same industry are forecast to see their revenue shrink 0.7% per year. It seems obvious that as part of the brighter growth outlook, COSCO SHIPPING Holdings is expected to grow faster than the wider industry.

The Bottom Line

The most obvious conclusion is that there's been no major change in the business' prospects in recent times, with the analysts holding their earnings forecasts steady, in line with previous estimates. On the plus side, they made no changes to their revenue estimates - and they expect it to perform better than the wider industry. The consensus price target fell measurably, with the analysts seemingly not reassured by the latest results, leading to a lower estimate of COSCO SHIPPING Holdings' 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. We have forecasts for COSCO SHIPPING Holdings going out to 2026, and you can see them free on our platform here.

You still need to take note of risks, for example - COSCO SHIPPING Holdings has 3 warning signs (and 1 which is significant) we think you should know about.

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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.