The half-year results for Shandong Chenming Paper Holdings Limited (SZSE:000488) were released last week, making it a good time to revisit its performance. Results were mixed, with revenues of CN¥17b exceeding expectations, even as statutory earnings per share (EPS) fell badly short. Earnings were CN¥0.064 per share, -29% short of analyst expectations. The analysts typically update their forecasts at each earnings report, and we can judge from their estimates whether their view of the company has changed or if there are any new concerns to be aware of. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether the analysts have changed their mind on Shandong Chenming Paper Holdings after the latest results.

See our latest analysis for Shandong Chenming Paper Holdings

Taking into account the latest results, the current consensus from Shandong Chenming Paper Holdings' two analysts is for revenues of CN¥33.8b in 2022, which would reflect an okay 3.9% increase on its sales over the past 12 months. Shandong Chenming Paper Holdings is also expected to turn profitable, with statutory earnings of CN¥0.23 per share. Yet prior to the latest earnings, the analysts had been anticipated revenues of CN¥30.0b and earnings per share (EPS) of CN¥0.18 in 2022. There has definitely been an improvement in perception after these results, with the analysts noticeably increasing both their earnings and revenue estimates.

Althoughthe analysts have upgraded their earnings estimates, there was no change to the consensus price target of CN¥5.20, suggesting that the forecast performance does not have a long term impact on the company's valuation.

Looking at the bigger picture now, one of the ways we can make sense of these forecasts is to see how they measure up against both past performance and industry growth estimates. It's clear from the latest estimates that Shandong Chenming Paper Holdings' rate of growth is expected to accelerate meaningfully, with the forecast 7.9% annualised revenue growth to the end of 2022 noticeably faster than its historical growth of 3.6% p.a. over the past five years. Compare this with other companies in the same industry, which are forecast to see revenue growth of 17% annually. It seems obvious that, while the future growth outlook is brighter than the recent past, Shandong Chenming Paper Holdings is expected to grow slower than the wider industry.

The Bottom Line

The biggest takeaway for us is the consensus earnings per share upgrade, which suggests a clear improvement in sentiment around Shandong Chenming Paper Holdings' earnings potential next year. They also upgraded their revenue estimates for next year, even though sales are expected to grow slower than the wider industry. The consensus price target held steady at CN¥5.20, 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 analyst estimates for Shandong Chenming Paper Holdings going out as far as 2024, and you can see them free on our platform here.

And what about risks? Every company has them, and we've spotted 3 warning signs for Shandong Chenming Paper Holdings (of which 1 is concerning!) you should know about.

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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.