Last week, you might have seen that Luk Fook Holdings (International) Limited (HKG:590) released its half-year result to the market. The early response was not positive, with shares down 2.4% to HK$14.66 in the past week. Revenues were HK$5.4b, 19% below analyst expectations, although losses didn't appear to worsen significantly, with a statutory per-share loss of HK$3.01 being in line with what the analysts anticipated. 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.

Following the recent earnings report, the consensus from nine analysts covering Luk Fook Holdings (International) is for revenues of HK$12.1b in 2025. This implies an uneasy 9.1% decline in revenue compared to the last 12 months. Statutory earnings per share are forecast to nosedive 21% to HK$1.70 in the same period. Before this earnings report, the analysts had been forecasting revenues of HK$14.6b and earnings per share (EPS) of HK$2.68 in 2025. It looks like sentiment has declined substantially in the aftermath of these results, with a real cut to revenue estimates and a pretty serious reduction to earnings per share numbers as well.

It'll come as no surprise then, to learn that the analysts have cut their price target 6.1% to HK$18.69. 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. Currently, the most bullish analyst values Luk Fook Holdings (International) at HK$22.08 per share, while the most bearish prices it at HK$17.00. Still, with such a tight range of estimates, it suggeststhe analysts have a pretty good idea of what they think the company is worth.

Taking a look at the bigger picture now, one of the ways we can understand these forecasts is to see how they compare to both past performance and industry growth estimates. These estimates imply that revenue is expected to slow, with a forecast annualised decline of 17% by the end of 2025. This indicates a significant reduction from annual growth of 6.4% 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 15% per year. It's pretty clear that Luk Fook Holdings (International)'s revenues are expected to perform substantially worse than the wider 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 data indicates underperformance compared to the wider industry. Even so, earnings per share are more important to the intrinsic value of the business. Furthermore, the analysts also cut their price targets, suggesting that the latest news has led to greater pessimism about the intrinsic value of the business.

With that said, the long-term trajectory of the company's earnings is a lot more important than next year. At Simply Wall St, we have a full range of analyst estimates for Luk Fook Holdings (International) going out to 2027, and you can see them free on our platform here..

Before you take the next step you should know about the 1 warning sign for Luk Fook Holdings (International) that we have uncovered.

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.