As you might know, Henan Shuanghui Investment & Development Co.,Ltd. (SZSE:000895) last week released its latest full-year, and things did not turn out so great for shareholders. Henan Shuanghui Investment & DevelopmentLtd missed earnings this time around, with CN¥60b revenue coming in 7.3% below what the analysts had modelled. Statutory earnings per share (EPS) of CN¥1.46 also fell short of expectations by 13%. 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. We've gathered the most recent statutory forecasts to see whether the analysts have changed their earnings models, following these results.
SZSE:000895 Earnings and Revenue Growth March 29th 2024
After the latest results, the 14 analysts covering Henan Shuanghui Investment & DevelopmentLtd are now predicting revenues of CN¥61.7b in 2024. If met, this would reflect a satisfactory 2.6% improvement in revenue compared to the last 12 months. Per-share earnings are expected to step up 10% to CN¥1.61. In the lead-up to this report, the analysts had been modelling revenues of CN¥70.1b and earnings per share (EPS) of CN¥1.81 in 2024. Indeed, we can see that the analysts are a lot more bearish about Henan Shuanghui Investment & DevelopmentLtd's prospects following the latest results, administering a real cut to revenue estimates and slashing their EPS estimates to boot.
Despite the cuts to forecast earnings, there was no real change to the CN¥29.77 price target, showing that the analysts don't think the changes have a meaningful impact on its intrinsic value. The consensus price target is just an average of individual analyst targets, so - it could be handy to see how wide the range of underlying estimates is. There are some variant perceptions on Henan Shuanghui Investment & DevelopmentLtd, with the most bullish analyst valuing it at CN¥34.60 and the most bearish at CN¥21.00 per share. These price targets show that analysts do have some differing views on the business, but the estimates do not vary enough to suggest to us that some are betting on wild success or utter failure.
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 can infer from the latest estimates that forecasts expect a continuation of Henan Shuanghui Investment & DevelopmentLtd'shistorical trends, as the 2.6% annualised revenue growth to the end of 2024 is roughly in line with the 2.7% annual growth over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to see their revenues grow 13% per year. So it's pretty clear that Henan Shuanghui Investment & DevelopmentLtd is expected to grow slower than similar companies in the same industry.
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. Unfortunately, they also downgraded their revenue estimates, and our data indicates underperformance compared to the wider industry. Even so, earnings per share are more important to the intrinsic value of the business. The consensus price target held steady at CN¥29.77, with the latest estimates not enough to have an impact on their price targets.
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 estimates - from multiple Henan Shuanghui Investment & DevelopmentLtd analysts - going out to 2026, and you can see them free on our platform here.
Even so, be aware that Henan Shuanghui Investment & DevelopmentLtd is showing 2 warning signs in our investment analysis , you should know about...
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