Investors in Guangzhou Restaurant Group Company Limited (SHSE:603043) had a good week, as its shares rose 3.6% to close at CN¥16.01 following the release of its quarterly results. Revenues were CN¥2.2b, 11% below analyst expectations, although losses didn't appear to worsen significantly, with a statutory per-share loss of CN¥0.97 being in line with what the analysts anticipated. Earnings are an important time for investors, as they can track a company's performance, look at what the analysts are forecasting for next year, and see if there's been a change in sentiment towards the company. With this in mind, we've gathered the latest statutory forecasts to see what the analysts are expecting for next year.
Following the latest results, Guangzhou Restaurant Group's nine analysts are now forecasting revenues of CN¥5.98b in 2025. This would be a notable 17% improvement in revenue compared to the last 12 months. Per-share earnings are expected to leap 31% to CN¥1.17. In the lead-up to this report, the analysts had been modelling revenues of CN¥6.04b and earnings per share (EPS) of CN¥1.19 in 2025. 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.
There were no changes to revenue or earnings estimates or the price target of CN¥19.22, suggesting that the company has met expectations in its recent result. Fixating on a single price target can be unwise though, since the consensus target is effectively the average of analyst price targets. As a result, some investors like to look at the range of estimates to see if there are any diverging opinions on the company's valuation. The most optimistic Guangzhou Restaurant Group analyst has a price target of CN¥23.00 per share, while the most pessimistic values it at CN¥17.13. This shows there is still a bit of diversity in estimates, but analysts don't appear to be totally split on the stock as though it might be a success or failure situation.
Looking at the bigger picture now, one of the ways we can make sense of these forecasts is to see how they measure up against both past performance and industry growth estimates. We can infer from the latest estimates that forecasts expect a continuation of Guangzhou Restaurant Group'shistorical trends, as the 13% annualised revenue growth to the end of 2025 is roughly in line with the 12% annual growth over the past five years. Juxtapose this against our data, which suggests that other companies (with analyst coverage) in the industry are forecast to see their revenues grow 15% per year. It's clear that while Guangzhou Restaurant Group's revenue growth is expected to continue on its current trajectory, it's only expected to grow in line with the industry itself.
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. Happily, there were no real changes to revenue forecasts, with the business still expected to grow in line with the overall 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. At Simply Wall St, we have a full range of analyst estimates for Guangzhou Restaurant Group going out to 2026, and you can see them free on our platform here..
Even so, be aware that Guangzhou Restaurant Group is showing 1 warning sign in our investment analysis , you should know about...
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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.
