The latest analyst coverage could presage a bad day for Guangzhou Haoyang Electronic Co.,Ltd. (SZSE:300833), 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) forecasts went under the knife, suggesting analysts have soured majorly on the business.

After the downgrade, the four analysts covering Guangzhou Haoyang ElectronicLtd are now predicting revenues of CN¥1.6b in 2024. If met, this would reflect a sizeable 24% improvement in sales compared to the last 12 months. Per-share earnings are expected to leap 28% to CN¥5.58. Prior to this update, the analysts had been forecasting revenues of CN¥1.9b and earnings per share (EPS) of CN¥6.76 in 2024. It looks like analyst sentiment has declined substantially, with a substantial drop in revenue estimates and a considerable drop in earnings per share numbers as well.

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Guangzhou Haoyang ElectronicLtd's past performance and to peers in the same industry. It's clear from the latest estimates that Guangzhou Haoyang ElectronicLtd's rate of growth is expected to accelerate meaningfully, with the forecast 24% annualised revenue growth to the end of 2024 noticeably faster than its historical growth of 19% p.a. over the past five years. Compare this with other companies in the same industry, which are forecast to grow their revenue 18% annually. It seems obvious that, while the growth outlook is brighter than the recent past, the analysts also expect Guangzhou Haoyang ElectronicLtd to grow faster than 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 Guangzhou Haoyang ElectronicLtd. While analysts did downgrade their revenue estimates, these forecasts still imply revenues will perform better than the wider market. Given the serious cut to this year's outlook, it's clear that analysts have turned more bearish on Guangzhou Haoyang ElectronicLtd, and we wouldn't blame shareholders for feeling a little more cautious themselves.

There might be good reason for analyst bearishness towards Guangzhou Haoyang ElectronicLtd, like concerns around earnings quality. For more information, you can click here to discover this and the 1 other warning sign we've identified.

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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.