The analysts might have been a bit too bullish on Sanquan Food Co., Ltd. (SZSE:002216), given that the company fell short of expectations when it released its quarterly results last week. It wasn't a great result overall - while revenue fell marginally short of analyst estimates at CN¥1.5b, statutory earnings missed forecasts by an incredible 37%, coming in at just CN¥0.07 per share. Earnings are an important time for investors, as they can track a company's performance, look at what the analysts are forecasting for next year, and see if there's been a change in sentiment towards the company. We've gathered the most recent statutory forecasts to see whether the analysts have changed their earnings models, following these results.

After the latest results, the eight analysts covering Sanquan Food are now predicting revenues of CN¥7.23b in 2025. If met, this would reflect an okay 6.8% improvement in revenue compared to the last 12 months. Statutory earnings per share are predicted to climb 13% to CN¥0.76. In the lead-up to this report, the analysts had been modelling revenues of CN¥7.26b and earnings per share (EPS) of CN¥0.77 in 2025. So it's pretty clear that, although the analysts have updated their estimates, there's been no major change in expectations for the business following the latest results.

The analysts reconfirmed their price target of CN¥12.96, showing that the business is executing well and in line with expectations. 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 Sanquan Food, with the most bullish analyst valuing it at CN¥17.00 and the most bearish at CN¥10.00 per share. Analysts definitely have varying views on the business, but the spread of estimates is not wide enough in our view to suggest that extreme outcomes could await Sanquan Food shareholders.

Taking a look at the bigger picture now, one of the ways we can understand these forecasts is to see how they compare to both past performance and industry growth estimates. It's clear from the latest estimates that Sanquan Food's rate of growth is expected to accelerate meaningfully, with the forecast 5.4% annualised revenue growth to the end of 2025 noticeably faster than its historical growth of 2.9% p.a. over the past five years. Compare this with other companies in the same industry, which are forecast to see revenue growth of 11% annually. It seems obvious that, while the future growth outlook is brighter than the recent past, Sanquan Food is expected to grow slower than the wider industry.

The Bottom Line

The most obvious conclusion is that there's been no major change in the business' prospects in recent times, with the analysts holding their earnings forecasts steady, in line with previous estimates. On the plus side, there were no major changes to revenue estimates; although forecasts imply they will perform worse than the wider industry. There was no real change to the consensus price target, suggesting that the intrinsic value of the business has not undergone any major changes with the latest estimates.

Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. We have forecasts for Sanquan Food going out to 2026, and you can see them free on our platform here.

However, before you get too enthused, we've discovered 1 warning sign for Sanquan Food 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.