Investors in Jinyu Bio-technology Co., Ltd. (SHSE:600201) had a good week, as its shares rose 3.6% to close at CN¥6.26 following the release of its half-year results. Results look mixed - while revenue fell marginally short of analyst estimates at CN¥612m, statutory earnings were in line with expectations, at CN¥0.11 per share. 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.

After the latest results, the eight analysts covering Jinyu Bio-technology are now predicting revenues of CN¥1.74b in 2024. If met, this would reflect a decent 14% improvement in revenue compared to the last 12 months. Statutory earnings per share are predicted to rise 6.7% to CN¥0.26. Before this earnings report, the analysts had been forecasting revenues of CN¥1.83b and earnings per share (EPS) of CN¥0.32 in 2024. The analysts seem less optimistic after the recent results, reducing their revenue forecasts and making a substantial drop in earnings per share numbers.

Despite the cuts to forecast earnings, there was no real change to the CN¥9.14 price target, showing that the analysts don't think the changes have a meaningful impact on its intrinsic value. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. Currently, the most bullish analyst values Jinyu Bio-technology at CN¥11.00 per share, while the most bearish prices it at CN¥6.00. There are definitely some different views on the stock, but the range of estimates is not wide enough as to imply that the situation is unforecastable, in our view.

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Jinyu Bio-technology's past performance and to peers in the same industry. It's clear from the latest estimates that Jinyu Bio-technology's rate of growth is expected to accelerate meaningfully, with the forecast 30% annualised revenue growth to the end of 2024 noticeably faster than its historical growth of 3.3% p.a. over the past five years. Compare this with other companies in the same industry, which are forecast to grow their revenue 25% annually. Jinyu Bio-technology is expected to grow at about the same rate as its industry, so it's not clear that we can draw any conclusions from its growth relative to competitors.

The Bottom Line

The biggest concern is that the analysts reduced their earnings per share estimates, suggesting business headwinds could lay ahead for Jinyu Bio-technology. They also downgraded their revenue estimates, although as we saw earlier, forecast growth is only expected to be about the same as the wider industry. The consensus price target held steady at CN¥9.14, with the latest estimates not enough to have an impact on their price targets.

With that said, the long-term trajectory of the company's earnings is a lot more important than next year. We have forecasts for Jinyu Bio-technology going out to 2026, and you can see them free on our platform here.

You still need to take note of risks, for example - Jinyu Bio-technology has 2 warning signs we think 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.