Today is shaping up negative for Fiberhome Telecommunication Technologies Co., Ltd. (SHSE:600498) shareholders, with the analysts delivering a substantial negative revision to next year's forecasts. Revenue estimates were cut sharply as analysts signalled a weaker outlook - perhaps a sign that investors should temper their expectations as well.

Following the downgrade, the current consensus from Fiberhome Telecommunication Technologies' three analysts is for revenues of CN¥38b in 2025 which - if met - would reflect a sizeable 29% increase on its sales over the past 12 months. Statutory earnings per share are presumed to shoot up 26% to CN¥0.61. Previously, the analysts had been modelling revenues of CN¥43b and earnings per share (EPS) of CN¥0.60 in 2025. So there's been a clear change in analyst sentiment in the recent update, with the analysts making a substantial drop in revenues and reconfirming their earnings per share estimates.

The consensus price target rose 6.0% to CN¥20.34, with the analysts apparently satisfied with the business performance despite lower revenue forecasts.

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. The analysts are definitely expecting Fiberhome Telecommunication Technologies' growth to accelerate, with the forecast 22% annualised growth to the end of 2025 ranking favourably alongside historical growth of 7.9% per annum over the past five years. Compare this with other companies in the same industry, which are forecast to grow their revenue 22% annually. Factoring in the forecast acceleration in revenue, it's pretty clear that Fiberhome Telecommunication Technologies is expected to grow at about the same rate as the wider industry.

The Bottom Line

The most important thing to take away is that there's been no major change in sentiment, with analysts reconfirming that earnings per share are expected to continue performing in line with their prior expectations. There was also a drop in their revenue estimates, although as we saw earlier, forecast growth is only expected to be about the same as the wider market. There was also an increase in the price target, suggesting that there is more optimism baked into the forecasts than there was previously. Given the stark change in sentiment, we'd understand if investors became more cautious on Fiberhome Telecommunication Technologies after today.

Still, the long-term prospects of the business are much more relevant than next year's earnings. We have estimates - from multiple Fiberhome Telecommunication Technologies analysts - going out to 2026, and you can see them free on our platform here.

Another way to search for interesting companies that could be reaching an inflection point is to track whether management are buying or selling, with our free list of growing companies backed by insiders.

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