Investors in JCET Group Co., Ltd. (SHSE:600584) had a good week, as its shares rose 2.6% to close at CN¥25.17 following the release of its first-quarter results. Results overall were not great, with earnings of CN¥0.08 per share falling drastically short of analyst expectations. Meanwhile revenues hit CN¥6.8b and were slightly better than forecasts. The analysts typically update their forecasts at each earnings report, and we can judge from their estimates whether their view of the company has changed or if there are any new concerns to be aware of. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether the analysts have changed their mind on JCET Group after the latest results.

Taking into account the latest results, the most recent consensus for JCET Group from 17 analysts is for revenues of CN¥33.0b in 2024. If met, it would imply a modest 7.7% increase on its revenue over the past 12 months. Per-share earnings are expected to surge 25% to CN¥1.05. In the lead-up to this report, the analysts had been modelling revenues of CN¥33.9b and earnings per share (EPS) of CN¥1.45 in 2024. From this we can that sentiment has definitely become more bearish after the latest results, leading to lower revenue forecasts and a pretty serious reduction to earnings per share estimates.

The analysts made no major changes to their price target of CN¥36.33, suggesting the downgrades are not expected to have a long-term impact on JCET Group's valuation. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. The most optimistic JCET Group analyst has a price target of CN¥45.00 per share, while the most pessimistic values it at CN¥20.90. Note the wide gap in analyst price targets? This implies to us that there is a fairly broad range of possible scenarios for the underlying business.

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 JCET Group's rate of growth is expected to accelerate meaningfully, with the forecast 10% annualised revenue growth to the end of 2024 noticeably faster than its historical growth of 7.2% p.a. over the past five years. Compare this with other companies in the same industry, which are forecast to see revenue growth of 23% annually. So it's clear that despite the acceleration in growth, JCET Group is expected to grow meaningfully slower than the industry average.

The Bottom Line

The biggest concern is that the analysts reduced their earnings per share estimates, suggesting business headwinds could lay ahead for JCET Group. On the negative side, they also downgraded their revenue estimates, and forecasts imply they will perform worse than the wider industry. The consensus price target held steady at CN¥36.33, with the latest estimates not enough to have an impact on their price targets.

With that in mind, we wouldn't be too quick to come to a conclusion on JCET Group. Long-term earnings power is much more important than next year's profits. We have estimates - from multiple JCET Group analysts - going out to 2026, and you can see them free on our platform here.

Even so, be aware that JCET Group is showing 1 warning sign in our investment analysis , 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.