Shareholders might have noticed that Wangsu Science & Technology Co.,Ltd. (SZSE:300017) filed its full-year result this time last week. The early response was not positive, with shares down 3.8% to CN¥8.81 in the past week. Revenues CN¥4.7b disappointed slightly, at7.0% below what the analysts had predicted. Profits were a relative bright spot, with statutory per-share earnings of CN¥0.25 coming in 18% above what was anticipated. 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. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether the analysts have changed their mind on Wangsu Science & TechnologyLtd after the latest results.
After the latest results, the seven analysts covering Wangsu Science & TechnologyLtd are now predicting revenues of CN¥4.94b in 2024. If met, this would reflect a modest 5.0% improvement in revenue compared to the last 12 months. Statutory earnings per share are forecast to decline 13% to CN¥0.22 in the same period. In the lead-up to this report, the analysts had been modelling revenues of CN¥5.53b and earnings per share (EPS) of CN¥0.22 in 2024. Indeed we can see that the consensus opinion has undergone some fundamental changes following the latest results, with a real cut to revenues and some minor tweaks to earnings numbers.
The consensus has reconfirmed its price target of CN¥7.79, showing that the analysts don't expect weaker revenue expectations next year to have a material impact on Wangsu Science & TechnologyLtd's market value. There's another way to think about price targets though, and that's to look at the range of price targets put forward by analysts, because a wide range of estimates could suggest a diverse view on possible outcomes for the business. There are some variant perceptions on Wangsu Science & TechnologyLtd, with the most bullish analyst valuing it at CN¥11.27 and the most bearish at CN¥4.70 per share. This is a fairly broad spread of estimates, suggesting that analysts are forecasting a wide range of possible outcomes for the business.
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. For example, we noticed that Wangsu Science & TechnologyLtd's rate of growth is expected to accelerate meaningfully, with revenues forecast to exhibit 5.0% growth to the end of 2024 on an annualised basis. That is well above its historical decline of 6.9% a year 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 revenue grow 20% per year. So although Wangsu Science & TechnologyLtd's revenue growth is expected to improve, it is still expected to grow slower than the industry.
The Bottom Line
The most important thing to take away is that there's been no major change in sentiment, with the analysts reconfirming that the business is performing in line with their previous earnings per share estimates. On the negative side, they also downgraded their revenue estimates, and forecasts imply they will perform worse than the wider industry. Still, earnings per share are more important to value creation for shareholders. The consensus price target held steady at CN¥7.79, 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 estimates - from multiple Wangsu Science & TechnologyLtd analysts - going out to 2026, and you can see them free on our platform here.
Even so, be aware that Wangsu Science & TechnologyLtd is showing 1 warning sign in our investment analysis , 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.