The analysts covering Jilin Electric Power Co.,Ltd. (SZSE:000875) delivered a dose of negativity to shareholders today, by making a substantial revision to their statutory forecasts for this year. Both revenue and earnings per share (EPS) forecasts went under the knife, suggesting analysts have soured majorly on the business. At CN¥5.03, shares are up 6.1% in the past 7 days. We'd be curious to see if the downgrade is enough to reverse investor sentiment on the business.
Following the downgrade, the most recent consensus for Jilin Electric PowerLtd from its three analysts is for revenues of CN¥16b in 2024 which, if met, would be a notable 9.0% increase on its sales over the past 12 months. Per-share earnings are expected to grow 19% to CN¥0.43. Previously, the analysts had been modelling revenues of CN¥18b and earnings per share (EPS) of CN¥0.53 in 2024. It looks like analyst sentiment has declined substantially, with a measurable cut to revenue estimates and a considerable drop in earnings per share numbers as well.
These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Jilin Electric PowerLtd's past performance and to peers in the same industry. We would highlight that Jilin Electric PowerLtd's revenue growth is expected to slow, with the forecast 9.0% annualised growth rate until the end of 2024 being well below the historical 15% p.a. growth over the last five years. Juxtapose this against the other companies in the industry with analyst coverage, which are forecast to grow their revenues (in aggregate) 7.1% per year. So it's pretty clear that, while Jilin Electric PowerLtd'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 analysts cut their earnings per share estimates, expecting a clear decline in business conditions. Unfortunately, analysts also downgraded their revenue estimates, although our data indicates revenues are expected to perform better than the wider market. We wouldn't be surprised to find shareholders feeling a bit shell-shocked, after these downgrades. It looks like analysts have become a lot more bearish on Jilin Electric PowerLtd, and their negativity could be grounds for caution.
With that said, the long-term trajectory of the company's earnings is a lot more important than next year. We have estimates - from multiple Jilin Electric PowerLtd analysts - going out to 2026, and you can see them free on our platform here.
Of course, seeing company management invest large sums of money in a stock can be just as useful as knowing whether analysts are downgrading their estimates. So you may also wish to search this free list of stocks that insiders are buying.
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