Shareholders will be ecstatic, with their stake up 45% over the past week following JSTI Group's (SZSE:300284) latest annual results. Statutory earnings per share fell badly short of expectations, coming in at CN¥0.26, some 35% below analyst forecasts, although revenues were okay, approximately in line with analyst estimates at CN¥5.3b. 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've gathered the most recent statutory forecasts to see whether the analysts have changed their earnings models, following these results.
After the latest results, the three analysts covering JSTI Group are now predicting revenues of CN¥5.73b in 2024. If met, this would reflect a decent 8.6% improvement in revenue compared to the last 12 months. Per-share earnings are expected to climb 15% to CN¥0.30. Before this earnings report, the analysts had been forecasting revenues of CN¥5.96b and earnings per share (EPS) of CN¥0.52 in 2024. The analysts seem less optimistic after the recent results, reducing their revenue forecasts and making a pretty serious reduction to earnings per share numbers.
The analysts made no major changes to their price target of CN¥7.33, suggesting the downgrades are not expected to have a long-term impact on JSTI Group's valuation.
These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the JSTI Group's past performance and to peers in the same industry. One thing stands out from these estimates, which is that JSTI Group is forecast to grow faster in the future than it has in the past, with revenues expected to display 8.6% annualised growth until the end of 2024. If achieved, this would be a much better result than the 5.4% annual decline over the past five years. Compare this against analyst estimates for the broader industry, which suggest that (in aggregate) industry revenues are expected to grow 11% annually for the foreseeable future. So although JSTI Group's revenue growth is expected to improve, it is still expected to grow slower than the industry.
The Bottom Line
The biggest concern is that the analysts reduced their earnings per share estimates, suggesting business headwinds could lay ahead for JSTI Group. 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¥7.33, 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 JSTI Group analysts - going out to 2026, and you can see them free on our platform here.
Plus, you should also learn about the 3 warning signs we've spotted with JSTI Group .
Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.
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.