As you might know, Guangzhou Shiyuan Electronic Technology Company Limited (SZSE:002841) last week released its latest full-year, and things did not turn out so great for shareholders. Guangzhou Shiyuan Electronic Technology missed earnings this time around, with CN¥20b revenue coming in 4.2% below what the analysts had modelled. Statutory earnings per share (EPS) of CN¥1.95 also fell short of expectations by 11%. 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. We thought readers would find it interesting to see the analysts latest (statutory) post-earnings forecasts for next year.
After the latest results, the seven analysts covering Guangzhou Shiyuan Electronic Technology are now predicting revenues of CN¥24.4b in 2024. If met, this would reflect a huge 21% improvement in revenue compared to the last 12 months. Per-share earnings are expected to leap 37% to CN¥2.67. In the lead-up to this report, the analysts had been modelling revenues of CN¥24.8b and earnings per share (EPS) of CN¥2.76 in 2024. So it looks like there's been a small decline in overall sentiment after the recent results - there's been no major change to revenue estimates, but the analysts did make a minor downgrade to their earnings per share forecasts.
The average price target fell 14% to CN¥50.60, with reduced earnings forecasts clearly tied to a lower valuation estimate. 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 Guangzhou Shiyuan Electronic Technology at CN¥68.00 per share, while the most bearish prices it at CN¥38.00. 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.
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. It's clear from the latest estimates that Guangzhou Shiyuan Electronic Technology's rate of growth is expected to accelerate meaningfully, with the forecast 21% annualised revenue growth to the end of 2024 noticeably faster than its historical growth of 5.1% p.a. over the past five years. Compare this with other companies in the same industry, which are forecast to grow their revenue 19% annually. Guangzhou Shiyuan Electronic Technology is expected to grow at about the same rate as its industry, so it's not clear that we can draw any conclusions from its growth relative to competitors.
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. Happily, there were no real changes to revenue forecasts, with the business still expected to grow in line with the overall industry. 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.
Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. At Simply Wall St, we have a full range of analyst estimates for Guangzhou Shiyuan Electronic Technology going out to 2025, and you can see them free on our platform here..
And what about risks? Every company has them, and we've spotted 2 warning signs for Guangzhou Shiyuan Electronic Technology you should know about.
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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.