Last week saw the newest quarterly earnings release from Yuan Long Ping High-Tech Agriculture Co., Ltd. (SZSE:000998), an important milestone in the company's journey to build a stronger business. Revenues fell badly short of expectations, with revenue of CN¥299m missing analyst predictions by 93%. Unsurprisingly, the statutory profit the analysts had been forecasting evaporated, turning into a loss of CN¥0.44 per share. 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. We thought readers would find it interesting to see the analysts latest (statutory) post-earnings forecasts for next year.
Taking into account the latest results, the most recent consensus for Yuan Long Ping High-Tech Agriculture from seven analysts is for revenues of CN¥11.3b in 2025. If met, it would imply a huge 30% increase on its revenue over the past 12 months. Per-share earnings are expected to surge 119% to CN¥0.51. Yet prior to the latest earnings, the analysts had been anticipated revenues of CN¥11.6b and earnings per share (EPS) of CN¥0.52 in 2025. The analysts are less bullish than they were before these results, given the reduced revenue forecasts and the minor downgrade to earnings per share expectations.
The analysts made no major changes to their price target of CN¥13.41, suggesting the downgrades are not expected to have a long-term impact on Yuan Long Ping High-Tech Agriculture's valuation. 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 Yuan Long Ping High-Tech Agriculture at CN¥14.85 per share, while the most bearish prices it at CN¥12.00. This is a very narrow spread of estimates, implying either that Yuan Long Ping High-Tech Agriculture is an easy company to value, or - more likely - the analysts are relying heavily on some key assumptions.
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. It's pretty clear that there is an expectation that Yuan Long Ping High-Tech Agriculture's revenue growth will slow down substantially, with revenues to the end of 2025 expected to display 23% growth on an annualised basis. This is compared to a historical growth rate of 29% over the past five years. By way of comparison, the other companies in this industry with analyst coverage are forecast to grow their revenue at 11% annually. So it's pretty clear that, while Yuan Long Ping High-Tech Agriculture's revenue growth is expected to slow, it's still expected to grow faster than the industry itself.
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. They also downgraded Yuan Long Ping High-Tech Agriculture's revenue estimates, but industry data suggests that it is expected to 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.
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. We have estimates - from multiple Yuan Long Ping High-Tech Agriculture analysts - going out to 2026, and you can see them free on our platform here.
Plus, you should also learn about the 2 warning signs we've spotted with Yuan Long Ping High-Tech Agriculture (including 1 which is a bit concerning) .
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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.
