The latest analyst coverage could presage a bad day for Intron Technology Holdings Limited (HKG:1760), with the analysts making across-the-board cuts to their statutory estimates that might leave shareholders a little shell-shocked. Both revenue and earnings per share (EPS) estimates were cut sharply as the analysts factored in the latest outlook for the business, concluding that they were too optimistic previously.

Following the latest downgrade, Intron Technology Holdings' four analysts currently expect revenues in 2024 to be CN¥6.1b, approximately in line with the last 12 months. Statutory earnings per share are anticipated to sink 12% to CN¥0.21 in the same period. Before this latest update, the analysts had been forecasting revenues of CN¥6.8b and earnings per share (EPS) of CN¥0.31 in 2024. It looks like analyst sentiment has declined substantially, with a substantial drop in revenue estimates and a pretty serious decline to earnings per share numbers as well.

It'll come as no surprise then, to learn that the analysts have cut their price target 32% to CN¥2.44. The consensus price target is just an average of individual analyst targets, so - it could be handy to see how wide the range of underlying estimates is. Currently, the most bullish analyst values Intron Technology Holdings at CN¥3.10 per share, while the most bearish prices it at CN¥1.87. There are definitely some different views on the stock, but the range of estimates is not wide enough as to imply that the situation is unforecastable, in our view.

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. It's pretty clear that there is an expectation that Intron Technology Holdings' revenue growth will slow down substantially, with revenues to the end of 2024 expected to display 3.7% growth on an annualised basis. This is compared to a historical growth rate of 26% over the past five years. Compare this against other companies (with analyst forecasts) in the industry, which are in aggregate expected to see revenue growth of 11% annually. So it's pretty clear that, while revenue growth is expected to slow down, the wider industry is also expected to grow faster than Intron Technology Holdings.

The Bottom Line

The most important thing to take away is that analysts cut their earnings per share estimates, expecting a clear decline in business conditions. Unfortunately analysts also downgraded their revenue estimates, and industry data suggests that Intron Technology Holdings' revenues are expected to grow slower than the wider market. Given the scope of the downgrades, it would not be a surprise to see the market become more wary of the business.

That said, the analysts might have good reason to be negative on Intron Technology Holdings, given its declining profit margins. Learn more, and discover the 3 other risks we've identified, for free on our platform here.

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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.