The analysts might have been a bit too bullish on Konfoong Materials International Co., Ltd (SZSE:300666), given that the company fell short of expectations when it released its third-quarter results last week. It looks like quite a negative result overall, with both revenues and earnings falling well short of analyst predictions. Revenues of CN¥654m missed by 11%, and statutory earnings per share of CN¥0.15 fell short of forecasts by 59%. This is an important time for investors, as they can track a company's performance in its report, look at what experts are forecasting for next year, and see if there has been any change to expectations for the business. So we collected the latest post-earnings statutory consensus estimates to see what could be in store for next year.
View our latest analysis for Konfoong Materials International
Taking into account the latest results, the current consensus from Konfoong Materials International's four analysts is for revenues of CN¥3.44b in 2024. This would reflect a sizeable 38% increase on its revenue over the past 12 months. Per-share earnings are expected to bounce 112% to CN¥1.89. Before this earnings report, the analysts had been forecasting revenues of CN¥3.65b and earnings per share (EPS) of CN¥1.98 in 2024. The analysts are less bullish than they were before these results, given the reduced revenue forecasts and the minor downgrade to earnings per share expectations.
Despite the cuts to forecast earnings, there was no real change to the CN¥71.45 price target, showing that the analysts don't think the changes have a meaningful impact on its intrinsic value. That's not the only conclusion we can draw from this data however, as some investors also like to consider the spread in estimates when evaluating analyst price targets. The most optimistic Konfoong Materials International analyst has a price target of CN¥76.00 per share, while the most pessimistic values it at CN¥65.80. The narrow spread of estimates could suggest that the business' future is relatively easy to value, or thatthe analysts have a strong view on its prospects.
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. We can infer from the latest estimates that forecasts expect a continuation of Konfoong Materials International'shistorical trends, as the 30% annualised revenue growth to the end of 2024 is roughly in line with the 30% annual growth over the past five years. Juxtapose this against our data, which suggests that other companies (with analyst coverage) in the industry are forecast to see their revenues grow 24% per year. So although Konfoong Materials International is expected to maintain its revenue growth rate, it's only growing at about the rate of 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. They also downgraded their revenue estimates, although as we saw earlier, forecast growth is only expected to be about the same as the wider industry. The consensus price target held steady at CN¥71.45, with the latest estimates not enough to have an impact on their price targets.
Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. We have forecasts for Konfoong Materials International going out to 2025, and you can see them free on our platform here.
Don't forget that there may still be risks. For instance, we've identified 1 warning sign for Konfoong Materials International that you should be aware of.
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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.
