Guangzhou Guanggang Gases & Energy Co.,Ltd. (SHSE:688548) just released its latest third-quarter report and things are not looking great. It looks like quite a negative result overall, with both revenues and earnings falling well short of analyst predictions. Revenues of CN¥526m missed by 16%, and statutory earnings per share of CN¥0.03 fell short of forecasts by 59%. Following the result, the analysts have updated their earnings model, and it would be good to know whether they think there's been a strong change in the company's prospects, or if it's business as usual. 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 Guangzhou Guanggang Gases & EnergyLtd from five analysts is for revenues of CN¥2.96b in 2025. If met, it would imply a huge 49% increase on its revenue over the past 12 months. Per-share earnings are expected to surge 73% to CN¥0.36. Before this earnings report, the analysts had been forecasting revenues of CN¥2.98b and earnings per share (EPS) of CN¥0.37 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.

The analysts reconfirmed their price target of CN¥10.85, showing that the business is executing well and in line with expectations. That's not the only conclusion we can draw from this data however, as some investors also like to consider the spread in estimates when evaluating analyst price targets. The most optimistic Guangzhou Guanggang Gases & EnergyLtd analyst has a price target of CN¥11.70 per share, while the most pessimistic values it at CN¥10.00. This is a very narrow spread of estimates, implying either that Guangzhou Guanggang Gases & EnergyLtd is an easy company to value, or - more likely - the analysts are relying heavily on some key assumptions.

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. The analysts are definitely expecting Guangzhou Guanggang Gases & EnergyLtd's growth to accelerate, with the forecast 38% annualised growth to the end of 2025 ranking favourably alongside historical growth of 23% per annum over the past five years. Compare this with other companies in the same industry, which are forecast to grow their revenue 16% annually. Factoring in the forecast acceleration in revenue, it's pretty clear that Guangzhou Guanggang Gases & EnergyLtd is expected to grow much faster than its industry.

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. Fortunately, they also reconfirmed their revenue numbers, suggesting that it's tracking in line with expectations. Additionally, our data suggests that revenue is expected to grow faster than the wider industry. The consensus price target held steady at CN¥10.85, with the latest estimates not enough to have an impact on their price targets.

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 forecasts for Guangzhou Guanggang Gases & EnergyLtd going out to 2026, and you can see them free on our platform here.

Even so, be aware that Guangzhou Guanggang Gases & EnergyLtd is showing 2 warning signs in our investment analysis , and 1 of those is significant...

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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.