The analysts covering Hoshine Silicon Industry Co., Ltd. (SHSE:603260) delivered a dose of negativity to shareholders today, by making a substantial revision to their statutory forecasts for this year. Revenue and earnings per share (EPS) forecasts were both revised downwards, with the analysts seeing grey clouds on the horizon. Shares are up 4.7% to CN¥48.35 in the past week. We'd be curious to see if the downgrade is enough to reverse investor sentiment on the business.

After the downgrade, the eight analysts covering Hoshine Silicon Industry are now predicting revenues of CN¥33b in 2024. If met, this would reflect a huge 24% improvement in sales compared to the last 12 months. Statutory earnings per share are presumed to shoot up 39% to CN¥2.52. Before this latest update, the analysts had been forecasting revenues of CN¥38b and earnings per share (EPS) of CN¥3.81 in 2024. Indeed, we can see that the analysts are a lot more bearish about Hoshine Silicon Industry's prospects, administering a measurable cut to revenue estimates and slashing their EPS estimates to boot.

The consensus price target fell 5.3% to CN¥62.60, with the weaker earnings outlook clearly leading analyst valuation estimates.

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. We can infer from the latest estimates that forecasts expect a continuation of Hoshine Silicon Industry'shistorical trends, as the 24% annualised revenue growth to the end of 2024 is roughly in line with the 26% annual revenue growth over the past five years. Compare this with the broader industry, which analyst estimates (in aggregate) suggest will see revenues grow 16% annually. So it's pretty clear that Hoshine Silicon Industry is forecast to grow substantially faster than its industry.

The Bottom Line

The biggest issue in the new estimates is that analysts have reduced their earnings per share estimates, suggesting business headwinds lay ahead for Hoshine Silicon Industry. While analysts did downgrade their revenue estimates, these forecasts still imply revenues will perform better than the wider market. After such a stark change in sentiment from analysts, we'd understand if readers now felt a bit wary of Hoshine Silicon Industry.

So things certainly aren't looking great, and you should also know that we've spotted some potential warning signs with Hoshine Silicon Industry, including its declining profit margins. Learn more, and discover the 2 other concerns we've identified, 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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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.