Guangdong Investment Limited (HKG:270) Analysts Just Slashed This Year's Revenue Estimates By 21%

The latest analyst coverage could presage a bad day for Guangdong Investment Limited (HKG:270), with the analysts making across-the-board cuts to their statutory estimates that might leave shareholders a little shell-shocked. This report focused on revenue estimates, and it looks as though the consensus view of the business has become substantially more conservative.

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Following the latest downgrade, Guangdong Investment's six analysts currently expect revenues in 2025 to be HK$18b, approximately in line with the last 12 months. Statutory earnings per share are forecast to be HK$0.63, approximately in line with the last 12 months. Previously, the analysts had been modelling revenues of HK$24b and earnings per share (EPS) of HK$0.65 in 2025. Indeed, we can see that analyst sentiment has declined measurably after the new consensus came out, with a pretty serious reduction to revenue estimates and a minor downgrade to EPS estimates to boot.

View our latest analysis for Guangdong Investment

Despite the cuts to forecast earnings, there was no real change to the HK$7.25 price target, showing that the analysts don't think the changes have a meaningful impact on its intrinsic value.

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. We would highlight that sales are expected to reverse, with a forecast 0.2% annualised revenue decline to the end of 2025. That is a notable change from historical growth of 2.3% over the last five years. Compare this with our data, which suggests that other companies in the same industry are, in aggregate, expected to see their revenue grow 5.6% per year. So although its revenues are forecast to shrink, this cloud does not come with a silver lining - Guangdong Investment is expected to lag the wider industry.

The Bottom Line

The biggest issue in the new estimates is that analysts have reduced their earnings per share estimates, suggesting business headwinds lay ahead for Guangdong Investment. Unfortunately analysts also downgraded their revenue estimates, and industry data suggests that Guangdong Investment's revenues are expected to grow slower than the wider market. Often, one downgrade can set off a daisy-chain of cuts, especially if an industry is in decline. So we wouldn't be surprised if the market became a lot more cautious on Guangdong Investment after today.

With that said, the long-term trajectory of the company's earnings is a lot more important than next year. We have estimates - from multiple Guangdong Investment analysts - going out to 2027, and you can see them free on our platform here.

Of course, seeing company management invest large sums of money in a stock can be just as useful as knowing whether analysts are downgrading their estimates. So you may also wish to search this free list of stocks with high insider ownership.

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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.