Investors in Zhejiang Dun'an Artificial Environment Co., Ltd (SZSE:002011) had a good week, as its shares rose 4.1% to close at CN¥10.47 following the release of its interim results. Results were roughly in line with estimates, with revenues of CN¥6.3b and statutory earnings per share of CN¥0.70. 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. So we collected the latest post-earnings statutory consensus estimates to see what could be in store for next year.

Taking into account the latest results, the most recent consensus for Zhejiang Dun'an Artificial Environment from six analysts is for revenues of CN¥12.7b in 2024. If met, it would imply a reasonable 4.8% increase on its revenue over the past 12 months. Statutory earnings per share are predicted to step up 10% to CN¥0.92. Before this earnings report, the analysts had been forecasting revenues of CN¥12.7b and earnings per share (EPS) of CN¥0.92 in 2024. The consensus analysts don't seem to have seen anything in these results that would have changed their view on the business, given there's been no major change to their estimates.

With no major changes to earnings forecasts, the consensus price target fell 5.6% to CN¥15.31, suggesting that the analysts might have previously been hoping for an earnings upgrade. 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. There are some variant perceptions on Zhejiang Dun'an Artificial Environment, with the most bullish analyst valuing it at CN¥16.28 and the most bearish at CN¥13.65 per share. Still, with such a tight range of estimates, it suggeststhe analysts have a pretty good idea of what they think the company is worth.

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. It's clear from the latest estimates that Zhejiang Dun'an Artificial Environment's rate of growth is expected to accelerate meaningfully, with the forecast 9.8% annualised revenue growth to the end of 2024 noticeably faster than its historical growth of 7.6% p.a. over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to grow their revenue at 14% per year. It seems obvious that, while the future growth outlook is brighter than the recent past, Zhejiang Dun'an Artificial Environment is expected to grow slower than the wider industry.

The Bottom Line

The most important thing to take away is that there's been no major change in sentiment, with the analysts reconfirming that the business is performing in line with their previous earnings per share estimates. On the plus side, there were no major changes to revenue estimates; although forecasts imply they will perform worse 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 Zhejiang Dun'an Artificial Environment's future valuation.

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 forecasts for Zhejiang Dun'an Artificial Environment going out to 2026, and you can see them free on our platform here.

Another thing to consider is whether management and directors have been buying or selling stock recently. We provide an overview of all open market stock trades for the last twelve months 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.