The half-year results for Shenzhen Senior Technology Material Co., LTD (SZSE:300568) were released last week, making it a good time to revisit its performance. It was a workmanlike result, with revenues of CN¥670m coming in 6.9% ahead of expectations, and statutory earnings per share of CN¥0.26, in line with analyst appraisals. 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. With this in mind, we've gathered the latest statutory forecasts to see what the analysts are expecting for next year.

View our latest analysis for Shenzhen Senior Technology Material

Following the latest results, Shenzhen Senior Technology Material's nine analysts are now forecasting revenues of CN¥3.02b in 2022. This would be a sizeable 28% improvement in sales compared to the last 12 months. Statutory earnings per share are predicted to bounce 27% to CN¥0.60. Before this earnings report, the analysts had been forecasting revenues of CN¥3.24b and earnings per share (EPS) of CN¥0.67 in 2022. The analysts seem less optimistic after the recent results, reducing their sales forecasts and making a substantial drop in earnings per share numbers.

The analysts made no major changes to their price target of CN¥36.43, suggesting the downgrades are not expected to have a long-term impact on Shenzhen Senior Technology Material's valuation. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. The most optimistic Shenzhen Senior Technology Material analyst has a price target of CN¥41.00 per share, while the most pessimistic values it at CN¥28.00. 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.

Another way we can view these estimates is in the context of the bigger picture, such as how the forecasts stack up against past performance, and whether forecasts are more or less bullish relative to other companies in the industry. The analysts are definitely expecting Shenzhen Senior Technology Material's growth to accelerate, with the forecast 63% annualised growth to the end of 2022 ranking favourably alongside historical growth of 34% per annum over the past five years. Compare this with other companies in the same industry, which are forecast to grow their revenue 19% annually. Factoring in the forecast acceleration in revenue, it's pretty clear that Shenzhen Senior Technology Material is expected to grow much faster than its industry.

The Bottom Line

The biggest concern is that the analysts reduced their earnings per share estimates, suggesting business headwinds could lay ahead for Shenzhen Senior Technology Material. Regrettably, they also downgraded their revenue estimates, but the latest forecasts still imply the business will grow faster than the wider industry. The consensus price target held steady at CN¥36.43, with the latest estimates not enough to have an impact on their price targets.

Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. At Simply Wall St, we have a full range of analyst estimates for Shenzhen Senior Technology Material going out to 2024, and you can see them free on our platform here..

Before you take the next step you should know about the 3 warning signs for Shenzhen Senior Technology Material (1 is a bit concerning!) that we have uncovered.

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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.