It's been a good week for Shanghai M&G Stationery Inc. (SHSE:603899) shareholders, because the company has just released its latest yearly results, and the shares gained 8.5% to CN¥38.80. It looks like the results were a bit of a negative overall. While revenues of CN¥23b were in line with analyst predictions, statutory earnings were less than expected, missing estimates by 2.1% to hit CN¥1.66 per share. Earnings are an important time for investors, as they can track a company's performance, look at what the analysts are forecasting for next year, and see if there's been a change in sentiment towards the company. 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 Shanghai M&G Stationery from 14 analysts is for revenues of CN¥27.8b in 2024. If met, it would imply a decent 19% increase on its revenue over the past 12 months. Per-share earnings are expected to grow 20% to CN¥1.97. Before this earnings report, the analysts had been forecasting revenues of CN¥28.3b and earnings per share (EPS) of CN¥2.03 in 2024. So it looks like there's been a small decline in overall sentiment after the recent results - there's been no major change to revenue estimates, but the analysts did make a minor downgrade to their earnings per share forecasts.
It might be a surprise to learn that the consensus price target was broadly unchanged at CN¥49.43, with the analysts clearly implying that the forecast decline in earnings is not expected to have much of an impact on valuation. 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. Currently, the most bullish analyst values Shanghai M&G Stationery at CN¥61.00 per share, while the most bearish prices it at CN¥36.00. There are definitely some different views on the stock, but the range of estimates is not wide enough as to imply that the situation is unforecastable, in our view.
Of course, another way to look at these forecasts is to place them into context against the industry itself. The period to the end of 2024 brings more of the same, according to the analysts, with revenue forecast to display 19% growth on an annualised basis. That is in line with its 20% annual growth over the past five years. Compare this with the broader industry, which analyst estimates (in aggregate) suggest will see revenues grow 20% annually. It's clear that while Shanghai M&G Stationery's revenue growth is expected to continue on its current trajectory, it's only expected to grow in line with 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 reconfirmed their revenue estimates, with the company predicted to grow at about the same rate as the wider industry. The consensus price target held steady at CN¥49.43, with the latest estimates not enough to have an impact on their price targets.
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 forecasts for Shanghai M&G Stationery going out to 2026, and you can see them free on our platform here.
Plus, you should also learn about the 1 warning sign we've spotted with Shanghai M&G Stationery .
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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.