Ningbo Ronbay New Energy Technology Co.,Ltd. (SHSE:688005) shareholders are probably feeling a little disappointed, since its shares fell 8.2% to CN¥31.69 in the week after its latest annual results. It was a negative result overall, with revenues coming in 19% less than what the analysts expected, at CN¥23b. 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.
View our latest analysis for Ningbo Ronbay New Energy TechnologyLtd
After the latest results, the twelve analysts covering Ningbo Ronbay New Energy TechnologyLtd are now predicting revenues of CN¥29.5b in 2024. If met, this would reflect a major 29% improvement in revenue compared to the last 12 months. Statutory earnings per share are predicted to surge 163% to CN¥3.22. Before this earnings report, the analysts had been forecasting revenues of CN¥31.8b and earnings per share (EPS) of CN¥3.45 in 2024. It's pretty clear that pessimism has reared its head after the latest results, leading to a weaker revenue outlook and a small dip in earnings per share estimates.
The consensus price target fell 17% to CN¥51.14, with the weaker earnings outlook clearly leading valuation estimates. That's not the only conclusion we can draw from this data however, as some investors also like to consider the spread in estimates when evaluating analyst price targets. There are some variant perceptions on Ningbo Ronbay New Energy TechnologyLtd, with the most bullish analyst valuing it at CN¥68.00 and the most bearish at CN¥33.00 per share. Note the wide gap in analyst price targets? This implies to us that there is a fairly broad range of possible scenarios for the underlying business.
These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Ningbo Ronbay New Energy TechnologyLtd's past performance and to peers in the same industry. It's pretty clear that there is an expectation that Ningbo Ronbay New Energy TechnologyLtd's revenue growth will slow down substantially, with revenues to the end of 2024 expected to display 29% growth on an annualised basis. This is compared to a historical growth rate of 50% 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 20% annually. So it's pretty clear that, while Ningbo Ronbay New Energy TechnologyLtd'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 the analysts downgraded their earnings per share estimates, showing that there has been a clear decline in sentiment following these results. They also downgraded Ningbo Ronbay New Energy TechnologyLtd's revenue estimates, but industry data suggests that it is expected to grow faster than the wider industry. Furthermore, the analysts also cut their price targets, suggesting that the latest news has led to greater pessimism about the intrinsic value of the business.
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. We have forecasts for Ningbo Ronbay New Energy TechnologyLtd going out to 2026, and you can see them free on our platform here.
It is also worth noting that we have found 3 warning signs for Ningbo Ronbay New Energy TechnologyLtd that you need to take into consideration.
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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.