It's been a good week for Ningxia Baofeng Energy Group Co., Ltd. (SHSE:600989) shareholders, because the company has just released its latest second-quarter results, and the shares gained 6.0% to CN¥15.52. It looks like a credible result overall - although revenues of CN¥8.7b were what the analysts expected, Ningxia Baofeng Energy Group surprised by delivering a (statutory) profit of CN¥0.26 per share, an impressive 67% above what was forecast. 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. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether the analysts have changed their mind on Ningxia Baofeng Energy Group after the latest results.

After the latest results, the eight analysts covering Ningxia Baofeng Energy Group are now predicting revenues of CN¥39.1b in 2024. If met, this would reflect a decent 19% improvement in revenue compared to the last 12 months. Statutory earnings per share are predicted to jump 21% to CN¥1.10. In the lead-up to this report, the analysts had been modelling revenues of CN¥38.1b and earnings per share (EPS) of CN¥1.12 in 2024. So it's pretty clear consensus is mixed on Ningxia Baofeng Energy Group after the latest results; whilethe analysts lifted revenue numbers, they also administered a minor downgrade to per-share earnings expectations.

There's been no major changes to the price target of CN¥21.90, suggesting that the impact of higher forecast revenue and lower earnings won't result in a meaningful change to the business' valuation. 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 Ningxia Baofeng Energy Group analyst has a price target of CN¥24.00 per share, while the most pessimistic values it at CN¥20.30. Even so, with a relatively close grouping of estimates, it looks like the analysts are quite confident in their valuations, suggesting Ningxia Baofeng Energy Group is an easy business to forecast or the the analysts are all using similar assumptions.

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Ningxia Baofeng Energy Group's past performance and to peers in the same industry. It's clear from the latest estimates that Ningxia Baofeng Energy Group's rate of growth is expected to accelerate meaningfully, with the forecast 41% annualised revenue growth to the end of 2024 noticeably faster than its historical growth of 19% p.a. over the past five years. Compare this with other companies in the same industry, which are forecast to grow their revenue 15% annually. Factoring in the forecast acceleration in revenue, it's pretty clear that Ningxia Baofeng Energy Group is expected to grow much faster than its 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. Pleasantly, they also upgraded their revenue estimates, and their forecasts suggest the business is expected to grow faster than the wider industry. The consensus price target held steady at CN¥21.90, with the latest estimates not enough to have an impact on their price targets.

Following on from that line of thought, we think that the long-term prospects of the business are much more relevant than next year's earnings. We have estimates - from multiple Ningxia Baofeng Energy Group 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 2 warning signs for Ningxia Baofeng Energy Group that you should be aware of.

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