Last week, you might have seen that Xinyi Solar Holdings Limited (HKG:968) released its half-year result to the market. The early response was not positive, with shares down 6.2% to HK$3.49 in the past week. Results were roughly in line with estimates, with revenues of HK$13b and statutory earnings per share of HK$0.47. 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. So we collected the latest post-earnings statutory consensus estimates to see what could be in store for next year.

After the latest results, the 25 analysts covering Xinyi Solar Holdings are now predicting revenues of HK$30.0b in 2024. If met, this would reflect a meaningful 10% improvement in revenue compared to the last 12 months. Statutory earnings per share are forecast to shrink 7.5% to HK$0.49 in the same period. Yet prior to the latest earnings, the analysts had been anticipated revenues of HK$32.7b and earnings per share (EPS) of HK$0.56 in 2024. The analysts seem less optimistic after the recent results, reducing their revenue forecasts and making a real cut to earnings per share numbers.

It'll come as no surprise then, to learn that the analysts have cut their price target 11% to HK$5.50. 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 Xinyi Solar Holdings analyst has a price target of HK$8.16 per share, while the most pessimistic values it at HK$3.70. 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.

Taking a look at the bigger picture now, one of the ways we can understand these forecasts is to see how they compare to both past performance and industry growth estimates. The period to the end of 2024 brings more of the same, according to the analysts, with revenue forecast to display 22% growth on an annualised basis. That is in line with its 25% annual growth over the past five years. Compare this with the broader industry, which analyst estimates (in aggregate) suggest will see revenues grow 13% annually. So although Xinyi Solar Holdings is expected to maintain its revenue growth rate, it's definitely expected to grow faster than 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 Xinyi Solar Holdings' revenue estimates, but industry data suggests that it is expected to grow faster than the wider industry. The consensus price target fell measurably, with the analysts seemingly not reassured by the latest results, leading to a lower estimate of Xinyi Solar Holdings' future valuation.

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 estimates - from multiple Xinyi Solar Holdings analysts - going out to 2026, 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 Xinyi Solar Holdings 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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com