Last week saw the newest second-quarter earnings release from Chifeng Jilong Gold Mining Co.,Ltd. (SHSE:600988), an important milestone in the company's journey to build a stronger business. Revenues came in 2.1% below expectations, at CN¥1.8b. Statutory earnings per share were relatively better off, with a per-share profit of CN¥0.27 being roughly in line with analyst estimates. Following the result, the analysts have updated their earnings model, and it would be good to know whether they think there's been a strong change in the company's prospects, or if it's business as usual. So we collected the latest post-earnings statutory consensus estimates to see what could be in store for next year.
See our latest analysis for Chifeng Jilong Gold MiningLtd
After the latest results, the nine analysts covering Chifeng Jilong Gold MiningLtd are now predicting revenues of CN¥7.19b in 2023. If met, this would reflect a satisfactory 5.0% improvement in revenue compared to the last 12 months. Statutory earnings per share are predicted to bounce 42% to CN¥0.49. Yet prior to the latest earnings, the analysts had been anticipated revenues of CN¥7.19b and earnings per share (EPS) of CN¥0.54 in 2023. So it looks like there's been a small decline in overall sentiment after the recent results - there's been no major change to revenue estimates, but the analysts did make a minor downgrade to their earnings per share forecasts.
The average price target fell 15% to CN¥17.75, with reduced earnings forecasts clearly tied to a lower valuation estimate. 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. The most optimistic Chifeng Jilong Gold MiningLtd analyst has a price target of CN¥18.60 per share, while the most pessimistic values it at CN¥16.65. Still, with such a tight range of estimates, it suggeststhe analysts have a pretty good idea of what they think the company is worth.
These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Chifeng Jilong Gold MiningLtd's past performance and to peers in the same industry. We can infer from the latest estimates that forecasts expect a continuation of Chifeng Jilong Gold MiningLtd'shistorical trends, as the 10% annualised revenue growth to the end of 2023 is roughly in line with the 11% annual growth over the past five years. Juxtapose this against our data, which suggests that other companies (with analyst coverage) in the industry are forecast to see their revenues grow 12% per year. It's clear that while Chifeng Jilong Gold MiningLtd's revenue growth is expected to continue on its current trajectory, it's only expected to grow in line with the industry itself.
The Bottom Line
The biggest concern is that the analysts reduced their earnings per share estimates, suggesting business headwinds could lay ahead for Chifeng Jilong Gold MiningLtd. They also reconfirmed their revenue estimates, with the company predicted to grow at about the same rate as the wider industry. The consensus price target fell measurably, with the analysts seemingly not reassured by the latest results, leading to a lower estimate of Chifeng Jilong Gold MiningLtd'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 estimates - from multiple Chifeng Jilong Gold MiningLtd analysts - going out to 2025, and you can see them free on our platform here.
You can also see whether Chifeng Jilong Gold MiningLtd is carrying too much debt, and whether its balance sheet is healthy, for free on our platform here.
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.