The analysts covering Hymson Laser Technology Group Co.,Ltd. (SHSE:688559) delivered a dose of negativity to shareholders today, by making a substantial revision to their statutory forecasts for this year. Both revenue and earnings per share (EPS) forecasts went under the knife, suggesting the analysts have soured majorly on the business. Bidders are definitely seeing a different story, with the stock price of CN¥43.79 reflecting a 35% rise in the past week. Whether the downgrade will have a negative impact on demand for shares is yet to be seen.
After this downgrade, Hymson Laser Technology GroupLtd's dual analysts are now forecasting revenues of CN¥5.5b in 2024. This would be a solid 10% improvement in sales compared to the last 12 months. Statutory earnings per share are presumed to ascend 13% to CN¥1.86. Previously, the analysts had been modelling revenues of CN¥8.9b and earnings per share (EPS) of CN¥5.58 in 2024. It looks like analyst sentiment has declined substantially, with a sizeable cut to revenue estimates and a pretty serious decline to earnings per share numbers as well.
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 Hymson Laser Technology GroupLtd's revenue growth is expected to slow, with the forecast 14% annualised growth rate until the end of 2024 being well below the historical 45% p.a. growth over the last three years. Compare this to the 479 other companies in this industry with analyst coverage, which are forecast to grow their revenue at 17% per year. So it's pretty clear that, while Hymson Laser Technology GroupLtd's revenue growth is expected to slow, it's expected to grow roughly in line with the 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. 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 serious cut to this year's outlook, it's clear that analysts have turned more bearish on Hymson Laser Technology GroupLtd, and we wouldn't blame shareholders for feeling a little more cautious themselves.
So things certainly aren't looking great, and you should also know that we've spotted some potential warning signs with Hymson Laser Technology GroupLtd, including concerns around earnings quality. Learn more, and discover the 1 other warning sign we've identified, for 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 with high insider ownership.
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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.