It's shaping up to be a tough period for Avary Holding(Shenzhen)Co., Limited (SZSE:002938), which a week ago released some disappointing annual results that could have a notable impact on how the market views the stock. It wasn't a great result overall - while revenue fell marginally short of analyst estimates at CN¥32b, statutory earnings missed forecasts by 14%, coming in at just CN¥1.42 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.
Taking into account the latest results, the most recent consensus for Avary Holding(Shenzhen)Co from eight analysts is for revenues of CN¥36.8b in 2024. If met, it would imply a meaningful 15% increase on its revenue over the past 12 months. Per-share earnings are expected to bounce 51% to CN¥2.14. In the lead-up to this report, the analysts had been modelling revenues of CN¥37.1b and earnings per share (EPS) of CN¥2.15 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.
The analysts reconfirmed their price target of CN¥30.88, showing that the business is executing well and in line with expectations. 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 Avary Holding(Shenzhen)Co at CN¥40.00 per share, while the most bearish prices it at CN¥24.00. 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 Avary Holding(Shenzhen)Co shareholders.
Of course, another way to look at these forecasts is to place them into context against the industry itself. The analysts are definitely expecting Avary Holding(Shenzhen)Co's growth to accelerate, with the forecast 15% annualised growth to the end of 2024 ranking favourably alongside historical growth of 7.3% per annum over the past five years. Compare this with other companies in the same industry, which are forecast to see revenue growth of 18% annually. So it's clear that despite the acceleration in growth, Avary Holding(Shenzhen)Co is expected to grow meaningfully slower than the industry average.
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. Fortunately, the analysts also reconfirmed their revenue estimates, suggesting that it's tracking in line with expectations. Although our data does suggest that Avary Holding(Shenzhen)Co's revenue is expected to 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 Avary Holding(Shenzhen)Co going out to 2025, and you can see them free on our platform here.
It is also worth noting that we have found 1 warning sign for Avary Holding(Shenzhen)Co that you need to take into consideration.
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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.