The annual results for Fujian Sunner Development Co., Ltd. (SZSE:002299) were released last week, making it a good time to revisit its performance. It looks like the results were a bit of a negative overall. While revenues of CN¥18b were in line with analyst predictions, statutory earnings were less than expected, missing estimates by 4.2% to hit CN¥0.54 per share. 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. We thought readers would find it interesting to see the analysts latest (statutory) post-earnings forecasts for next year.
Taking into account the latest results, the most recent consensus for Fujian Sunner Development from nine analysts is for revenues of CN¥21.6b in 2024. If met, it would imply a meaningful 17% increase on its revenue over the past 12 months. Per-share earnings are expected to bounce 160% to CN¥1.39. Before this earnings report, the analysts had been forecasting revenues of CN¥22.2b and earnings per share (EPS) of CN¥1.52 in 2024. The analysts are less bullish than they were before these results, given the reduced revenue forecasts and the minor downgrade to earnings per share expectations.
Despite the cuts to forecast earnings, there was no real change to the CN¥22.36 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. The most optimistic Fujian Sunner Development analyst has a price target of CN¥24.02 per share, while the most pessimistic values it at CN¥19.00. Still, with such a tight range of estimates, it suggeststhe analysts have a pretty good idea of what they think the company is worth.
Looking at the bigger picture now, one of the ways we can make sense of these forecasts is to see how they measure up against both past performance and industry growth estimates. It's clear from the latest estimates that Fujian Sunner Development's rate of growth is expected to accelerate meaningfully, with the forecast 17% annualised revenue growth to the end of 2024 noticeably faster than its historical growth of 7.8% p.a. over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to grow their revenue at 13% per year. It seems obvious that, while the growth outlook is brighter than the recent past, the analysts also expect Fujian Sunner Development to grow faster than the wider industry.
The Bottom Line
The biggest concern is that the analysts reduced their earnings per share estimates, suggesting business headwinds could lay ahead for Fujian Sunner Development. Regrettably, they also downgraded their revenue estimates, but the latest forecasts still imply the business will grow faster than the wider industry. 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.
With that said, the long-term trajectory of the company's earnings is a lot more important than next year. We have forecasts for Fujian Sunner Development going out to 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 Fujian Sunner Development .
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