Poly Developments and Holdings Group Co., Ltd. (SHSE:600048) came out with its annual results last week, and we wanted to see how the business is performing and what industry forecasters think of the company following this report. Results were mixed, with revenues of CN¥347b exceeding expectations, even as statutory earnings per share (EPS) fell badly short. Earnings were CN¥1.01 per share, -37% short of analyst expectations. 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. So we gathered the latest post-earnings forecasts to see what estimates suggest is in store for next year.
Taking into account the latest results, the current consensus, from the 20 analysts covering Poly Developments and Holdings Group, is for revenues of CN¥334.1b in 2024. This implies a noticeable 3.7% reduction in Poly Developments and Holdings Group's revenue over the past 12 months. Statutory earnings per share are predicted to accumulate 8.8% to CN¥1.10. Before this earnings report, the analysts had been forecasting revenues of CN¥336.2b and earnings per share (EPS) of CN¥1.10 in 2024. So it's pretty clear that, although the analysts have updated their estimates, there's been no major change in expectations for the business following the latest results.
It will come as no surprise then, to learn that the consensus price target is largely unchanged at CN¥12.67. 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 Poly Developments and Holdings Group, with the most bullish analyst valuing it at CN¥25.00 and the most bearish at CN¥8.40 per share. With such a wide range in price targets, analysts are almost certainly betting on widely divergent outcomes in the underlying business. As a result it might not be a great idea to make decisions based on the consensus price target, which is after all just an average of this wide range of estimates.
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. We would highlight that revenue is expected to reverse, with a forecast 3.7% annualised decline to the end of 2024. That is a notable change from historical growth of 10% over the last five years. Compare this with our data, which suggests that other companies in the same industry are, in aggregate, expected to see their revenue grow 5.1% per year. So although its revenues are forecast to shrink, this cloud does not come with a silver lining - Poly Developments and Holdings Group is expected to lag the wider 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. Fortunately, the analysts also reconfirmed their revenue estimates, suggesting that it's tracking in line with expectations. Although our data does suggest that Poly Developments and Holdings Group's revenue is expected to perform worse than the wider industry. The consensus price target held steady at CN¥12.67, with the latest estimates not enough to have an impact on their price targets.
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 Poly Developments and Holdings Group analysts - going out to 2026, and you can see them free on our platform here.
You still need to take note of risks, for example - Poly Developments and Holdings Group has 3 warning signs (and 1 which shouldn't be ignored) we think 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.