This Broker Just Slashed Their Tung Thih Electronic Co., Ltd. (GTSM:3552) Earnings Forecasts

One thing we could say about the covering analyst on Tung Thih Electronic Co., Ltd. (GTSM:3552) - they aren't optimistic, having just made a major negative revision to their near-term (statutory) forecasts for the organization. Both revenue and earnings per share (EPS) estimates were cut sharply as the analyst factored in the latest outlook for the business, concluding that they were too optimistic previously.

Following the downgrade, the most recent consensus for Tung Thih Electronic from its lone analyst is for revenues of NT$10.0b in 2021 which, if met, would be a major 41% increase on its sales over the past 12 months. Per-share earnings are expected to leap 209% to NT$10.06. Previously, the analyst had been modelling revenues of NT$12b and earnings per share (EPS) of NT$14.37 in 2021. Indeed, we can see that the analyst is a lot more bearish about Tung Thih Electronic's prospects, administering a substantial drop in revenue estimates and slashing their EPS estimates to boot.

View our latest analysis for Tung Thih Electronic

The consensus price target fell 16% to NT$365, with the weaker earnings outlook clearly leading analyst valuation estimates.

One way to get more context on these forecasts is to look at how they compare to both past performance, and how other companies in the same industry are performing. One thing stands out from these estimates, which is that Tung Thih Electronic is forecast to grow faster in the future than it has in the past, with revenues expected to display 41% annualised growth until the end of 2021. If achieved, this would be a much better result than the 6.3% annual decline over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in the industry are forecast to see their revenue grow 14% per year. So it looks like Tung Thih Electronic is expected to grow faster than its competitors, at least for a while.

The Bottom Line

The biggest issue in the new estimates is that the analyst has reduced their earnings per share estimates, suggesting business headwinds lay ahead for Tung Thih Electronic. While the analyst did downgrade their revenue estimates, these forecasts still imply revenues will perform better than the wider market. After such a stark change in sentiment from the analyst, we'd understand if readers now felt a bit wary of Tung Thih Electronic.

Worse, Tung Thih Electronic is labouring under a substantial debt burden, which - if today's forecasts prove accurate - the forecast downgrade could potentially exacerbate. To see more of our financial analysis, you can click through to our free platform to learn more about its balance sheet and specific concerns we've identified.

You can also see our analysis of Tung Thih Electronic's Board and CEO remuneration and experience, and whether company insiders have been buying stock.

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