The latest analyst coverage could presage a bad day for Triumph New Energy Company Limited (HKG:1108), with the analysts making across-the-board cuts to their statutory estimates that might leave shareholders a little shell-shocked. Revenue estimates were cut sharply as analysts signalled a weaker outlook - perhaps a sign that investors should temper their expectations as well.
After the downgrade, the three analysts covering Triumph New Energy are now predicting revenues of CN¥6.5b in 2024. If met, this would reflect a meaningful 17% improvement in sales compared to the last 12 months. Before the latest update, the analysts were foreseeing CN¥7.7b of revenue in 2024. It looks like forecasts have become a fair bit less optimistic on Triumph New Energy, given the substantial drop in revenue estimates.
Check out our latest analysis for Triumph New Energy
We'd point out that there was no major changes to their price target of CN¥6.15, suggesting the latest estimates were not enough to shift their view on the value of the business. There's another way to think about price targets though, and that's to look at the range of price targets put forward by analysts, because a wide range of estimates could suggest a diverse view on possible outcomes for the business. There are some variant perceptions on Triumph New Energy, with the most bullish analyst valuing it at CN¥7.00 and the most bearish at CN¥5.31 per share. Still, with such a tight range of estimates, it suggests the analysts have a pretty good idea of what they think the company is worth.
These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Triumph New Energy's past performance and to peers in the same industry. It's pretty clear that there is an expectation that Triumph New Energy's revenue growth will slow down substantially, with revenues to the end of 2024 expected to display 17% growth on an annualised basis. This is compared to a historical growth rate of 24% over the past five years. Juxtapose this against the other companies in the industry with analyst coverage, which are forecast to grow their revenues (in aggregate) 8.1% per year. Even after the forecast slowdown in growth, it seems obvious that Triumph New Energy is also expected to grow faster than the wider industry.
The Bottom Line
The most important thing to take away is that analysts cut their revenue estimates for this year. The analysts also expect revenues to grow faster than the wider market. Overall, given the drastic downgrade to this year's forecasts, we'd be feeling a little more wary of Triumph New Energy going forwards.
Want more information? We have estimates for Triumph New Energy from its three analysts out until 2026, and you can see them free on our platform here.
Another way to search for interesting companies that could be reaching an inflection point is to track whether management are buying or selling, with our free list of growing companies backed by insiders.
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.