DongHua Testing Technology Co. , Ltd. (SZSE:300354) shareholders are probably feeling a little disappointed, since its shares fell 4.7% to CN¥29.20 in the week after its latest interim results. DongHua Testing Technology reported in line with analyst predictions, delivering revenues of CN¥276m and statutory earnings per share of CN¥0.63, suggesting the business is executing well and in line with its plan. 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. So we gathered the latest post-earnings forecasts to see what estimates suggest is in store for next year.

After the latest results, the three analysts covering DongHua Testing Technology are now predicting revenues of CN¥640.4m in 2024. If met, this would reflect a major 41% improvement in revenue compared to the last 12 months. Per-share earnings are expected to bounce 65% to CN¥1.39. Yet prior to the latest earnings, the analysts had been anticipated revenues of CN¥659.0m and earnings per share (EPS) of CN¥1.43 in 2024. It's pretty clear that pessimism has reared its head after the latest results, leading to a weaker revenue outlook and a minor downgrade to earnings per share estimates.

The consensus price target fell 13% to CN¥40.80, with the weaker earnings outlook clearly leading valuation estimates.

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the DongHua Testing Technology's past performance and to peers in the same industry. It's clear from the latest estimates that DongHua Testing Technology's rate of growth is expected to accelerate meaningfully, with the forecast 99% annualised revenue growth to the end of 2024 noticeably faster than its historical growth of 23% p.a. over the past five years. Compare this with other companies in the same industry, which are forecast to grow their revenue 18% annually. It seems obvious that, while the growth outlook is brighter than the recent past, the analysts also expect DongHua Testing Technology to grow faster than the wider industry.

The Bottom Line

The biggest concern is that the analysts reduced their earnings per share estimates, suggesting business headwinds could lay ahead for DongHua Testing 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.

With that said, the long-term trajectory of the company's earnings is a lot more important than next year. At Simply Wall St, we have a full range of analyst estimates for DongHua Testing Technology going out to 2026, and you can see them free on our platform here..

And what about risks? Every company has them, and we've spotted 1 warning sign for DongHua Testing 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.