Sunwoda Electronic Co.,Ltd (SZSE:300207) missed earnings with its latest full-year results, disappointing overly-optimistic forecasters. Sunwoda ElectronicLtd missed analyst forecasts, with revenues of CN¥48b and statutory earnings per share (EPS) of CN¥0.58, falling short by 3.4% and 5.3% respectively. 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. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether the analysts have changed their mind on Sunwoda ElectronicLtd after the latest results.
Taking into account the latest results, the current consensus from Sunwoda ElectronicLtd's eight analysts is for revenues of CN¥58.9b in 2024. This would reflect a major 23% increase on its revenue over the past 12 months. Statutory earnings per share are predicted to soar 26% to CN¥0.73. Yet prior to the latest earnings, the analysts had been anticipated revenues of CN¥59.0b and earnings per share (EPS) of CN¥0.82 in 2024. The analysts seem to have become more bearish following the latest results. While there were no changes to revenue forecasts, there was a real cut to EPS estimates.
The consensus price target held steady at CN¥20.00, with the analysts seemingly voting that their lower forecast earnings are not expected to lead to a lower stock price in the foreseeable future. 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. There are some variant perceptions on Sunwoda ElectronicLtd, with the most bullish analyst valuing it at CN¥26.00 and the most bearish at CN¥14.00 per share. Analysts definitely have varying views on the business, but the spread of estimates is not wide enough in our view to suggest that extreme outcomes could await Sunwoda ElectronicLtd shareholders.
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. We can infer from the latest estimates that forecasts expect a continuation of Sunwoda ElectronicLtd'shistorical trends, as the 23% annualised revenue growth to the end of 2024 is roughly in line with the 20% annual growth over the past five years. Compare this with the broader industry, which analyst estimates (in aggregate) suggest will see revenues grow 18% annually. So although Sunwoda ElectronicLtd is expected to maintain its revenue growth rate, it's definitely expected 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 Sunwoda ElectronicLtd. Fortunately, they also reconfirmed their revenue numbers, suggesting that it's tracking in line with expectations. Additionally, our data suggests that revenue is expected to grow faster than the wider industry. The consensus price target held steady at CN¥20.00, with the latest estimates not enough to have an impact on their price targets.
With that said, the long-term trajectory of the company's earnings is a lot more important than next year. We have forecasts for Sunwoda ElectronicLtd going out to 2026, and you can see them free on our platform here.
And what about risks? Every company has them, and we've spotted 1 warning sign for Sunwoda ElectronicLtd you should know about.
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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.