It's shaping up to be a tough period for Bloomage BioTechnology Corporation Limited (SHSE:688363), which a week ago released some disappointing yearly results that could have a notable impact on how the market views the stock. It wasn't a great result overall - while revenue fell marginally short of analyst estimates at CN¥6.1b, statutory earnings missed forecasts by an incredible 26%, coming in at just CN¥1.23 per share. 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. So we collected the latest post-earnings statutory consensus estimates to see what could be in store for next year.
Taking into account the latest results, the consensus forecast from Bloomage BioTechnology's twelve analysts is for revenues of CN¥7.06b in 2024. This reflects a decent 16% improvement in revenue compared to the last 12 months. Statutory earnings per share are predicted to leap 47% to CN¥1.81. Yet prior to the latest earnings, the analysts had been anticipated revenues of CN¥7.50b and earnings per share (EPS) of CN¥1.81 in 2024. So it looks like the analysts have become a bit less optimistic after the latest results announcement, with revenues expected to fall even as the company is supposed to maintain EPS.
The average price target was reduced 9.9% to CN¥75.39, with the lower revenue forecasts indicating negative sentiment towards Bloomage BioTechnology, even though earnings forecasts were unchanged. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. There are some variant perceptions on Bloomage BioTechnology, with the most bullish analyst valuing it at CN¥131 and the most bearish at CN¥45.00 per share. With such a wide range in price targets, analysts are almost certainly betting on widely divergent outcomes in the underlying business. With this in mind, we wouldn't rely too heavily the consensus price target, as it is just an average and analysts clearly have some deeply divergent views on the business.
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. It's pretty clear that there is an expectation that Bloomage BioTechnology's revenue growth will slow down substantially, with revenues to the end of 2024 expected to display 16% growth on an annualised basis. This is compared to a historical growth rate of 33% over the past five years. By way of comparison, the other companies in this industry with analyst coverage are forecast to grow their revenue at 24% per year. Factoring in the forecast slowdown in growth, it seems obvious that Bloomage BioTechnology is also expected to grow slower than other industry participants.
The Bottom Line
The most important thing to take away is that there's been no major change in sentiment, with the analysts reconfirming that the business is performing in line with their previous earnings per share estimates. Unfortunately, they also downgraded their revenue estimates, and our data indicates underperformance compared to the wider industry. Even so, earnings per share are more important to the intrinsic value of the business. Yet - earnings are more important to the intrinsic value of the business. The consensus price target fell measurably, with the analysts seemingly not reassured by the latest results, leading to a lower estimate of Bloomage BioTechnology's future valuation.
Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. We have forecasts for Bloomage BioTechnology going out to 2026, and you can see them free on our platform here.
Before you take the next step you should know about the 2 warning signs for Bloomage BioTechnology 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.