One thing we could say about the analysts on Hangzhou Jingye Intelligent Technology Co., Ltd. (SHSE:688290) - they aren't optimistic, having just made a major negative revision to their near-term (statutory) forecasts for the organization. Revenue and earnings per share (EPS) forecasts were both revised downwards, with analysts seeing grey clouds on the horizon.
After the downgrade, the three analysts covering Hangzhou Jingye Intelligent Technology are now predicting revenues of CN¥430m in 2024. If met, this would reflect a huge 90% improvement in sales compared to the last 12 months. Statutory earnings per share are presumed to shoot up 463% to CN¥0.97. Before this latest update, the analysts had been forecasting revenues of CN¥663m and earnings per share (EPS) of CN¥1.69 in 2024. It looks like analyst sentiment has declined substantially, with a pretty serious reduction to revenue estimates and a pretty serious decline to earnings per share numbers as well.
Despite the cuts to forecast earnings, there was no real change to the CN¥49.91 price target, showing that the analysts don't think the changes have a meaningful impact on its intrinsic value.
These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Hangzhou Jingye Intelligent Technology's past performance and to peers in the same industry. For example, we noticed that Hangzhou Jingye Intelligent Technology's rate of growth is expected to accelerate meaningfully, with revenues forecast to exhibit 90% growth to the end of 2024 on an annualised basis. That is well above its historical decline of 53% a year over the past year. By contrast, our data suggests that other companies (with analyst coverage) in the industry are forecast to see their revenue grow 17% per year. Not only are Hangzhou Jingye Intelligent Technology'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 biggest issue in the new estimates is that analysts have reduced their earnings per share estimates, suggesting business headwinds lay ahead for Hangzhou Jingye Intelligent Technology. While analysts did downgrade their revenue estimates, these forecasts still imply revenues will perform better than the wider market. The lack of change in the price target is puzzling in light of the downgrade but, with a serious decline expected this year, we wouldn't be surprised if investors were a bit wary of Hangzhou Jingye Intelligent Technology.
As you can see, the analysts clearly aren't bullish, and there might be good reason for that. We've identified some potential issues with Hangzhou Jingye Intelligent Technology's financials, such as its declining profit margins. Learn more, and discover the 4 other warning signs we've identified, for 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 that insiders are buying.
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.