Sino Land Company Limited (HKG:83) just released its latest annual report and things are not looking great. Results showed a clear earnings miss, with HK$16b revenue coming in 5.6% lower than what the analystsexpected. Statutory earnings per share (EPS) of HK$0.76 missed the mark badly, arriving some 22% below what was expected. This is an important time for investors, as they can track a company's performance in its report, look at what experts are forecasting for next year, and see if there has been any change to expectations for the business. So we gathered the latest post-earnings forecasts to see what estimates suggest is in store for next year.
Check out our latest analysis for Sino LandSEHK:83 Earnings and Revenue Growth August 28th 2022
Taking into account the latest results, Sino Land's eight analysts currently expect revenues in 2023 to be HK$15.6b, approximately in line with the last 12 months. Statutory earnings per share are predicted to expand 12% to HK$0.83. Yet prior to the latest earnings, the analysts had been anticipated revenues of HK$17.7b and earnings per share (EPS) of HK$1.03 in 2023. Indeed, we can see that the analysts are a lot more bearish about Sino Land's prospects following the latest results, administering a real cut to revenue estimates and slashing their EPS estimates to boot.
The analysts made no major changes to their price target of HK$12.01, suggesting the downgrades are not expected to have a long-term impact on Sino Land's valuation. There's another way to think about price targets though, and that's to look at the range of price targets put forward by analysts, because a wide range of estimates could suggest a diverse view on possible outcomes for the business. Currently, the most bullish analyst values Sino Land at HK$14.20 per share, while the most bearish prices it at HK$9.00. 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.
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 would highlight that Sino Land's revenue growth is expected to slow, with the forecast 0.4% annualised growth rate until the end of 2023 being well below the historical 15% p.a. growth over the last five years. Compare this against other companies (with analyst forecasts) in the industry, which are in aggregate expected to see revenue growth of 8.7% annually. Factoring in the forecast slowdown in growth, it seems obvious that Sino Land is also expected to grow slower than other industry participants.
The Bottom Line
The biggest concern is that the analysts reduced their earnings per share estimates, suggesting business headwinds could lay ahead for Sino Land. Unfortunately, they also downgraded their revenue estimates, and our data indicates revenues are expected to perform worse than the wider industry. Even so, earnings per share are more important to the intrinsic value of the business. There was no real change to the consensus price target, suggesting that the intrinsic value of the business has not undergone any major changes with the latest estimates.
Following on from that line of thought, we think that the long-term prospects of the business are much more relevant than next year's earnings. At Simply Wall St, we have a full range of analyst estimates for Sino Land going out to 2025, and you can see them free on our platform here..
That said, it's still necessary to consider the ever-present spectre of investment risk. We've identified 1 warning sign with Sino Land , and understanding it should be part of your investment process.
Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.
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.