Today is shaping up negative for CSI Solar Co., Ltd. (SHSE:688472) shareholders, with the analysts delivering a substantial negative revision to this year's forecasts. There was a fairly draconian cut to their revenue estimates, perhaps an implicit admission that previous forecasts were much too optimistic.

Following the downgrade, the most recent consensus for CSI Solar from its six analysts is for revenues of CN¥61b in 2024 which, if met, would be a substantial 25% increase on its sales over the past 12 months. Statutory earnings per share are presumed to leap 29% to CN¥0.89. Before this latest update, the analysts had been forecasting revenues of CN¥59b and earnings per share (EPS) of CN¥0.92 in 2024. Overall it looks as though the analysts were a bit mixed on the latest consensus updates. Although there was a nice uplift to revenue, the consensus also made a small dip in to its earnings per share forecasts.

The consensus price target was unchanged at CN¥15.75, suggesting the business is performing roughly in line with expectations, despite some adjustments to profit and revenue forecasts.

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. One thing stands out from these estimates, which is that CSI Solar is forecast to grow faster in the future than it has in the past, with revenues expected to display 25% annualised growth until the end of 2024. If achieved, this would be a much better result than the 5.0% annual decline over the past year. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to see their revenue grow 23% per year. So while CSI Solar's revenues are expected to improve, it seems that it is expected to grow at about the same rate as the overall industry.

The Bottom Line

The most important thing to take away is that analysts cut their earnings per share estimates, expecting a clear decline in business conditions. They also upgraded their revenue forecasts, although the latest estimates suggest that CSI Solar will grow in line with the overall market. Given the stark change in sentiment, we'd understand if investors became more cautious on CSI Solar after today.

With that said, the long-term trajectory of the company's earnings is a lot more important than next year. At Simply Wall St, we have a full range of analyst estimates for CSI Solar 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.

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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.