One thing we could say about the analysts on Shenzhen Overseas Chinese Town Co.,Ltd. (SZSE:000069) - they aren't optimistic, having just made a major negative revision to their near-term (statutory) forecasts for the organization. There was a fairly draconian cut to their revenue estimates, perhaps an implicit admission that previous forecasts were much too optimistic.

Following the latest downgrade, the current consensus, from the five analysts covering Shenzhen Overseas Chinese TownLtd, is for revenues of CN¥54b in 2024, which would reflect a perceptible 3.5% reduction in Shenzhen Overseas Chinese TownLtd's sales over the past 12 months. Prior to the latest estimates, the analysts were forecasting revenues of CN¥76b in 2024. It looks like forecasts have become a fair bit less optimistic on Shenzhen Overseas Chinese TownLtd, given the sizeable cut to revenue estimates.

The consensus price target fell 17% to CN¥3.29, with the analysts clearly less optimistic about Shenzhen Overseas Chinese TownLtd's valuation following this update.

Of course, another way to look at these forecasts is to place them into context against the industry itself. We would highlight that sales are expected to reverse, with a forecast 3.5% annualised revenue decline to the end of 2024. That is a notable change from historical growth of 9.3% over the last five years. By contrast, our data suggests that other companies (with analyst coverage) in the same industry are forecast to see their revenue grow 5.5% annually for the foreseeable future. It's pretty clear that Shenzhen Overseas Chinese TownLtd's revenues are expected to perform substantially worse than the wider industry.

The Bottom Line

The most important thing to take away is that analysts cut their revenue estimates for this year. They also expect company revenue to perform worse than the wider market. The consensus price target fell measurably, with analysts seemingly not reassured by recent business developments, leading to a lower estimate of Shenzhen Overseas Chinese TownLtd's future valuation. Given the stark change in sentiment, we'd understand if investors became more cautious on Shenzhen Overseas Chinese TownLtd after today.

Of course, this isn't the full story. At least one of Shenzhen Overseas Chinese TownLtd's five analysts has provided estimates out to 2026, which can be seen for free on our platform here.

Another way to search for interesting companies that could be reaching an inflection point is to track whether management are buying or selling, with our free list of growing companies that insiders are buying.

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