One thing we could say about the analysts on SBT Ultrasonic Technology Co.,Ltd. (SHSE:688392) - they aren't optimistic, having just made a major negative revision to their near-term (statutory) forecasts for the organization. Revenue and earnings per share (EPS) forecasts were both revised downwards, with analysts seeing grey clouds on the horizon. Bidders are definitely seeing a different story, with the stock price of CN¥34.40 reflecting a 12% rise in the past week. It will be interesting to see if the downgrade has an impact on buying demand for the company's shares.

Following the downgrade, the current consensus from SBT Ultrasonic TechnologyLtd's three analysts is for revenues of CN¥551m in 2024 which - if met - would reflect a major 31% increase on its sales over the past 12 months. Statutory earnings per share are presumed to surge 688% to CN¥0.63. Before this latest update, the analysts had been forecasting revenues of CN¥653m and earnings per share (EPS) of CN¥0.79 in 2024. Indeed, we can see that the analysts are a lot more bearish about SBT Ultrasonic TechnologyLtd's prospects, administering a substantial drop in revenue estimates and slashing their EPS estimates to boot.

It'll come as no surprise then, to learn that the analysts have cut their price target 12% to CN¥56.67.

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the SBT Ultrasonic TechnologyLtd's past performance and to peers in the same industry. One thing stands out from these estimates, which is that SBT Ultrasonic TechnologyLtd 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 33% 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 16% annually. So it looks like SBT Ultrasonic TechnologyLtd is expected to grow faster than its competitors, at least for a while.

The Bottom Line

The most important thing to take away is that analysts cut their earnings per share estimates, expecting a clear decline in business conditions. Unfortunately, analysts also downgraded their revenue estimates, although our data indicates revenues are expected to perform better than the wider market. After such a stark change in sentiment from analysts, we'd understand if readers now felt a bit wary of SBT Ultrasonic TechnologyLtd.

So things certainly aren't looking great, and you should also know that we've spotted some potential warning signs with SBT Ultrasonic TechnologyLtd, including concerns around earnings quality. Learn more, and discover the 1 other warning sign we've identified, for free on our platform here.

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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.