One thing we could say about the analysts on Yindu Kitchen Equipment Co., Ltd (SHSE:603277) - they aren't optimistic, having just made a major negative revision to their near-term (statutory) forecasts for the organization. Revenue estimates were cut sharply as analysts signalled a weaker outlook - perhaps a sign that investors should temper their expectations as well.

After this downgrade, Yindu Kitchen Equipment's three analysts are now forecasting revenues of CN¥3.1b in 2024. This would be a meaningful 18% improvement in sales compared to the last 12 months. Per-share earnings are expected to surge 25% to CN¥1.52. Prior to this update, the analysts had been forecasting revenues of CN¥3.5b and earnings per share (EPS) of CN¥1.60 in 2024. It looks like analyst sentiment has fallen somewhat in this update, with a measurable cut to revenue estimates and a minor downgrade to earnings per share numbers as well.

Analysts made no major changes to their price target of CN¥34.32, suggesting the downgrades are not expected to have a long-term impact on Yindu Kitchen Equipment's valuation.

One way to get more context on these forecasts is to look at how they compare to both past performance, and how other companies in the same industry are performing. The analysts are definitely expecting Yindu Kitchen Equipment's growth to accelerate, with the forecast 18% annualised growth to the end of 2024 ranking favourably alongside historical growth of 14% per annum over the past five years. Compare this with other companies in the same industry, which are forecast to grow their revenue 17% annually. Yindu Kitchen Equipment is expected to grow at about the same rate as its industry, so it's not clear that we can draw any conclusions from its growth relative to competitors.

The Bottom Line

The biggest issue in the new estimates is that analysts have reduced their earnings per share estimates, suggesting business headwinds lay ahead for Yindu Kitchen Equipment. There was also a drop in their revenue estimates, although as we saw earlier, forecast growth is only expected to be about the same as the wider market. Given the stark change in sentiment, we'd understand if investors became more cautious on Yindu Kitchen Equipment after today.

Still, the long-term prospects of the business are much more relevant than next year's earnings. At Simply Wall St, we have a full range of analyst estimates for Yindu Kitchen Equipment going out to 2026, and you can see them free on our platform here.

Of course, seeing company management invest large sums of money in a stock can be just as useful as knowing whether analysts are downgrading their estimates. So you may also wish to search this free list of stocks that insiders are buying.

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.