Investors in Jiangsu Pacific Precision Forging Co., Ltd. (SZSE:300258) had a good week, as its shares rose 3.2% to close at CN¥8.64 following the release of its first-quarter results. Revenues were CN¥504m, 15% below analyst expectations, although losses didn't appear to worsen significantly, with a per-share statutory loss of CN¥0.48 being in line with what the analysts forecast. 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. So we collected the latest post-earnings statutory consensus estimates to see what could be in store for next year.
Following the latest results, Jiangsu Pacific Precision Forging's three analysts are now forecasting revenues of CN¥2.48b in 2024. This would be a sizeable 20% improvement in revenue compared to the last 12 months. Statutory earnings per share are predicted to bounce 69% to CN¥0.58. Before this earnings report, the analysts had been forecasting revenues of CN¥2.61b and earnings per share (EPS) of CN¥0.61 in 2024. It's pretty clear that pessimism has reared its head after the latest results, leading to a weaker revenue outlook and a minor downgrade to earnings per share estimates.
The analysts made no major changes to their price target of CN¥15.44, suggesting the downgrades are not expected to have a long-term impact on Jiangsu Pacific Precision Forging's valuation.
One way to get more context on these forecasts is to look at how they compare to both past performance, and how other companies in the same industry are performing. The analysts are definitely expecting Jiangsu Pacific Precision Forging's growth to accelerate, with the forecast 28% annualised growth to the end of 2024 ranking favourably alongside historical growth of 15% per annum over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to grow their revenue at 18% per year. It seems obvious that, while the growth outlook is brighter than the recent past, the analysts also expect Jiangsu Pacific Precision Forging to grow faster than the wider industry.
The Bottom Line
The most important thing to take away is that the analysts downgraded their earnings per share estimates, showing that there has been a clear decline in sentiment following these results. Regrettably, they also downgraded their revenue estimates, but the latest forecasts still imply the business will grow faster 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.
With that said, the long-term trajectory of the company's earnings is a lot more important than next year. We have estimates - from multiple Jiangsu Pacific Precision Forging analysts - going out to 2026, and you can see them free on our platform here.
Even so, be aware that Jiangsu Pacific Precision Forging is showing 2 warning signs in our investment analysis , you should know about...
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.
