As you might know, Yuneng Technology Co., Ltd. (SHSE:688348) last week released its latest first-quarter, and things did not turn out so great for shareholders. Unfortunately, Yuneng Technology delivered a serious earnings miss. Revenues of CN¥428m were 11% below expectations, and statutory earnings per share of CN¥0.36 missed estimates by 38%. Following the result, the analysts have updated their earnings model, and it would be good to know whether they think there's been a strong change in the company's prospects, or if it's business as usual. We've gathered the most recent statutory forecasts to see whether the analysts have changed their earnings models, following these results.
Taking into account the latest results, the most recent consensus for Yuneng Technology from three analysts is for revenues of CN¥2.12b in 2024. If met, it would imply a substantial 50% increase on its revenue over the past 12 months. Per-share earnings are expected to jump 117% to CN¥2.79. Before this earnings report, the analysts had been forecasting revenues of CN¥2.30b and earnings per share (EPS) of CN¥3.16 in 2024. The analysts seem less optimistic after the recent results, reducing their revenue forecasts and making a substantial drop in earnings per share numbers.
It'll come as no surprise then, to learn that the analysts have cut their price target 29% to CN¥76.33. 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 Yuneng Technology at CN¥100.00 per share, while the most bearish prices it at CN¥55.00. As you can see, analysts are not all in agreement on the stock's future, but the range of estimates is still reasonably narrow, which could suggest that the outcome is not totally unpredictable.
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. One thing stands out from these estimates, which is that Yuneng Technology is forecast to grow faster in the future than it has in the past, with revenues expected to display 71% annualised growth until the end of 2024. If achieved, this would be a much better result than the 12% annual decline over the past year. Compare this against analyst estimates for the broader industry, which suggest that (in aggregate) industry revenues are expected to grow 18% annually. So it looks like Yuneng Technology is expected to grow faster than its competitors, at least for a while.
The Bottom Line
The biggest concern is that the analysts reduced their earnings per share estimates, suggesting business headwinds could lay ahead for Yuneng Technology. Regrettably, they also downgraded their revenue estimates, but the latest forecasts still imply the business will grow faster than the wider 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 Yuneng Technology going out to 2026, and you can see them free on our platform here..
You still need to take note of risks, for example - Yuneng Technology has 3 warning signs (and 1 which can't be ignored) we think 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.
