Jiangsu Hengrui Medicine Co., Ltd. (SHSE:600276) shareholders are probably feeling a little disappointed, since its shares fell 5.5% to CN¥41.68 in the week after its latest quarterly results. The result was positive overall - although revenues of CN¥6.0b were in line with what the analysts predicted, Jiangsu Hengrui Medicine surprised by delivering a statutory profit of CN¥0.21 per share, modestly greater than expected. This is an important time for investors, as they can track a company's performance in its report, look at what experts are forecasting for next year, and see if there has been any change to expectations for the business. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether the analysts have changed their mind on Jiangsu Hengrui Medicine after the latest results.
After the latest results, the 22 analysts covering Jiangsu Hengrui Medicine are now predicting revenues of CN¥26.5b in 2024. If met, this would reflect a notable 14% improvement in revenue compared to the last 12 months. Statutory earnings per share are predicted to soar 25% to CN¥0.87. In the lead-up to this report, the analysts had been modelling revenues of CN¥27.0b and earnings per share (EPS) of CN¥0.89 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.
It will come as no surprise then, to learn that the consensus price target is largely unchanged at CN¥57.89. 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. The most optimistic Jiangsu Hengrui Medicine analyst has a price target of CN¥120 per share, while the most pessimistic values it at CN¥40.10. We would probably assign less value to the analyst forecasts in this situation, because such a wide range of estimates could imply that the future of this business is difficult to value accurately. With this in mind, we wouldn't rely too heavily the consensus price target, as it is just an average and analysts clearly have some deeply divergent views on the business.
Another way we can view these estimates is in the context of the bigger picture, such as how the forecasts stack up against past performance, and whether forecasts are more or less bullish relative to other companies in the industry. One thing stands out from these estimates, which is that Jiangsu Hengrui Medicine is forecast to grow faster in the future than it has in the past, with revenues expected to display 19% annualised growth until the end of 2024. If achieved, this would be a much better result than the 0.08% annual decline over the past five years. Compare this against analyst estimates for the broader industry, which suggest that (in aggregate) industry revenues are expected to grow 14% annually. Not only are Jiangsu Hengrui Medicine's revenues expected to improve, it seems that the analysts are also expecting it to grow faster 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. Fortunately, they also reconfirmed their revenue numbers, suggesting that it's tracking in line with expectations. Additionally, our data suggests that revenue is expected to grow faster than the wider industry. The consensus price target held steady at CN¥57.89, with the latest estimates not enough to have an impact on their price targets.
Following on from that line of thought, we think that the long-term prospects of the business are much more relevant than next year's earnings. At Simply Wall St, we have a full range of analyst estimates for Jiangsu Hengrui Medicine going out to 2026, and you can see them free on our platform here..
Another thing to consider is whether management and directors have been buying or selling stock recently. We provide an overview of all open market stock trades for the last twelve months on our platform, here.
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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.