It's been a good week for Shenzhou International Group Holdings Limited (HKG:2313) shareholders, because the company has just released its latest annual results, and the shares gained 8.0% to HK$74.10. Revenues came in 6.6% below expectations, at CN¥25b. Statutory earnings per share were relatively better off, with a per-share profit of CN¥3.03 being roughly in line with analyst estimates. 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. With this in mind, we've gathered the latest statutory forecasts to see what the analysts are expecting for next year.
Following the latest results, Shenzhou International Group Holdings' 27 analysts are now forecasting revenues of CN¥28.8b in 2024. This would be a meaningful 15% improvement in revenue compared to the last 12 months. Per-share earnings are expected to shoot up 21% to CN¥3.68. In the lead-up to this report, the analysts had been modelling revenues of CN¥30.3b and earnings per share (EPS) of CN¥3.68 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 consensus has reconfirmed its price target of HK$94.65, showing that the analysts don't expect weaker revenue expectations next year to have a material impact on Shenzhou International Group Holdings' market value. Fixating on a single price target can be unwise though, since the consensus target is effectively the average of analyst price targets. As a result, some investors like to look at the range of estimates to see if there are any diverging opinions on the company's valuation. Currently, the most bullish analyst values Shenzhou International Group Holdings at HK$124 per share, while the most bearish prices it at HK$66.87. This is a fairly broad spread of estimates, suggesting that analysts are forecasting a wide range of possible outcomes for the business.
Taking a look at the bigger picture now, one of the ways we can understand these forecasts is to see how they compare to both past performance and industry growth estimates. The analysts are definitely expecting Shenzhou International Group Holdings' growth to accelerate, with the forecast 15% annualised growth to the end of 2024 ranking favourably alongside historical growth of 4.5% per annum over the past five years. Compare this with other companies in the same industry, which are forecast to grow their revenue 9.7% annually. It seems obvious that, while the growth outlook is brighter than the recent past, the analysts also expect Shenzhou International Group Holdings to grow faster than the wider industry.
The Bottom Line
The most obvious conclusion is that there's been no major change in the business' prospects in recent times, with the analysts holding their earnings forecasts steady, in line with previous estimates. They also downgraded Shenzhou International Group Holdings' revenue estimates, but industry data suggests that it is expected to grow faster than the wider industry. Even so, earnings 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.
Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. At Simply Wall St, we have a full range of analyst estimates for Shenzhou International Group Holdings going out to 2026, and you can see them free on our platform here..
Another thing to consider is whether management and directors have been buying or selling stock recently. We provide an overview of all open market stock trades for the last twelve months on our platform, here.
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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.