As you might know, Hangzhou Onechance Tech Crop. (SZSE:300792) last week released its latest yearly, and things did not turn out so great for shareholders. The analysts look to have been far too optimistic in the lead-up to these results, with revenues of (CN¥1.3b) coming in 29% below what they had expected. Statutory earnings per share of CN¥0.46 fell 53% short. 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. So we collected the latest post-earnings statutory consensus estimates to see what could be in store for next year.
After the latest results, the three analysts covering Hangzhou Onechance Tech Crop are now predicting revenues of CN¥1.82b in 2024. If met, this would reflect a sizeable 41% improvement in revenue compared to the last 12 months. Statutory earnings per share are predicted to surge 174% to CN¥1.24. Before this earnings report, the analysts had been forecasting revenues of CN¥2.06b and earnings per share (EPS) of CN¥1.16 in 2024. It looks like there's been a meaningful change to the consensus view following the recent earnings report, with the analysts making a substantial drop in to revenue forecasts and a small increase to to next year's earnings estimates.
The analysts have cut their price target 32% to CN¥18.00per share, suggesting that the declining revenue was a more crucial indicator than the expected improvement in earnings.
Taking a look at the bigger picture now, one of the ways we can understand these forecasts is to see how they compare to both past performance and industry growth estimates. It's clear from the latest estimates that Hangzhou Onechance Tech Crop's rate of growth is expected to accelerate meaningfully, with the forecast 41% annualised revenue growth to the end of 2024 noticeably faster than its historical growth of 3.4% p.a. over the past five years. Compare this with other companies in the same industry, which are forecast to grow their revenue 13% annually. It seems obvious that, while the growth outlook is brighter than the recent past, the analysts also expect Hangzhou Onechance Tech Crop to grow faster than the wider industry.
The Bottom Line
The biggest takeaway for us is the consensus earnings per share upgrade, which suggests a clear improvement in sentiment around Hangzhou Onechance Tech Crop's earnings potential next year. They also downgraded Hangzhou Onechance Tech Crop's revenue estimates, but industry data suggests that it is expected to grow faster than the wider industry. Even so, long term profitability is more important for the value creation process. Furthermore, the analysts also cut their price targets, suggesting that the latest news has led to greater pessimism about the intrinsic value of the business.
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 estimates - from multiple Hangzhou Onechance Tech Crop analysts - 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 Hangzhou Onechance Tech Crop .
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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.