It's shaping up to be a tough period for Guangxi Fenglin Wood Industry Group Co.,Ltd (SHSE:601996), which a week ago released some disappointing full-year 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¥2.3b, statutory earnings missed forecasts by an incredible 55%, coming in at just CN¥0.05 per share. The analyst 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. We've gathered the most recent statutory forecasts to see whether the analyst has changed their earnings models, following these results.
Following the latest results, Guangxi Fenglin Wood Industry GroupLtd's solitary analyst are now forecasting revenues of CN¥2.64b in 2024. This would be a solid 13% improvement in revenue compared to the last 12 months. Statutory earnings per share are predicted to leap 72% to CN¥0.08. In the lead-up to this report, the analyst had been modelling revenues of CN¥2.96b and earnings per share (EPS) of CN¥0.14 in 2024. It looks like sentiment has declined substantially in the aftermath of these results, with a substantial drop in revenue estimates and a pretty serious reduction to earnings per share numbers as well.
The consensus price target fell 12% to CN¥3.04, with the weaker earnings outlook clearly leading valuation estimates.
Of course, another way to look at these forecasts is to place them into context against the industry itself. The analyst is definitely expecting Guangxi Fenglin Wood Industry GroupLtd's growth to accelerate, with the forecast 13% annualised growth to the end of 2024 ranking favourably alongside historical growth of 6.5% per annum over the past five years. Other similar companies in the industry (with analyst coverage) are also forecast to grow their revenue at 12% per year. Guangxi Fenglin Wood Industry GroupLtd is expected to grow at about the same rate as its industry, so it's not clear that we can draw any conclusions from its growth relative to competitors.
The Bottom Line
The biggest concern is that the analyst reduced their earnings per share estimates, suggesting business headwinds could lay ahead for Guangxi Fenglin Wood Industry GroupLtd. Sadly, they also downgraded their revenue forecasts, but the business is still expected to grow at roughly the same rate as the industry itself. Furthermore, the analyst also cut their price targets, suggesting that the latest news has led to greater pessimism about the intrinsic value of the business.
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 analyst estimates for Guangxi Fenglin Wood Industry GroupLtd going out as far as 2026, and you can see them free on our platform here.
Plus, you should also learn about the 2 warning signs we've spotted with Guangxi Fenglin Wood Industry GroupLtd .
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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.