JA Solar Technology Co., Ltd. (SZSE:002459) last week reported its latest first-quarter results, which makes it a good time for investors to dive in and see if the business is performing in line with expectations. Results look mixed - while revenue fell marginally short of analyst estimates at CN¥16b, statutory earnings were in line with expectations, at CN¥2.10 per share. 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. With this in mind, we've gathered the latest statutory forecasts to see what the analysts are expecting for next year.
Taking into account the latest results, the most recent consensus for JA Solar Technology from 18 analysts is for revenues of CN¥93.3b in 2024. If met, it would imply a major 21% increase on its revenue over the past 12 months. Statutory earnings per share are predicted to jump 113% to CN¥2.57. Yet prior to the latest earnings, the analysts had been anticipated revenues of CN¥98.1b and earnings per share (EPS) of CN¥2.66 in 2024. The analysts are less bullish than they were before these results, given the reduced revenue forecasts and the small dip in earnings per share expectations.
It'll come as no surprise then, to learn that the analysts have cut their price target 5.2% to CN¥26.27. 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. Currently, the most bullish analyst values JA Solar Technology at CN¥51.66 per share, while the most bearish prices it at CN¥12.90. So we wouldn't be assigning too much credibility to analyst price targets in this case, because there are clearly some widely different views on what kind of performance this business can generate. 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.
These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the JA Solar Technology's past performance and to peers in the same industry. The period to the end of 2024 brings more of the same, according to the analysts, with revenue forecast to display 29% growth on an annualised basis. That is in line with its 34% annual growth over the past five years. Compare this with the broader industry, which analyst estimates (in aggregate) suggest will see revenues grow 23% annually. So it's pretty clear that JA Solar Technology is forecast to grow substantially faster than its industry.
The Bottom Line
The biggest concern is that the analysts reduced their earnings per share estimates, suggesting business headwinds could lay ahead for JA Solar Technology. They also downgraded JA Solar Technology's revenue estimates, but industry data suggests that it is expected to grow faster than the wider industry. The consensus price target fell measurably, with the analysts seemingly not reassured by the latest results, leading to a lower estimate of JA Solar Technology's future valuation.
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 JA Solar Technology going out to 2026, and you can see them free on our platform here.
However, before you get too enthused, we've discovered 3 warning signs for JA Solar Technology (1 is concerning!) that you should be aware of.
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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.