Market forces rained on the parade of China Tobacco International (HK) Company Limited (HKG:6055) shareholders today, when the analysts downgraded their forecasts for this year. Revenue and earnings per share (EPS) forecasts were both revised downwards, with the analysts seeing grey clouds on the horizon.
Following the latest downgrade, the four analysts covering China Tobacco International (HK) provided consensus estimates of HK$14b revenue in 2026, which would reflect a measurable 5.3% decline on its sales over the past 12 months. Statutory earnings per share are supposed to decrease 8.6% to HK$1.30 in the same period. Before this latest update, the analysts had been forecasting revenues of HK$15b and earnings per share (EPS) of HK$1.53 in 2026. Indeed, we can see that the analysts are a lot more bearish about China Tobacco International (HK)’s prospects, administering a measurable cut to revenue estimates and slashing their EPS estimates to boot.
Check out our latest analysis for China Tobacco International (HK)
It’ll come as no surprise then, to learn that the analysts have cut their price target 19% to HK$37.58.
Another way we can view these estimates is in the context of the bigger picture, such as how the forecasts stack up against past performance, and whether forecasts are more or less bullish relative to other companies in the industry. We would highlight that sales are expected to reverse, with a forecast 5.3% annualised revenue decline to the end of 2026. That is a notable change from historical growth of 21% over the last five years. By contrast, our data suggests that other companies (with analyst coverage) in the same industry are forecast to see their revenue grow 11% annually for the foreseeable future. So although its revenues are forecast to shrink, this cloud does not come with a silver lining – China Tobacco International (HK) is expected to lag the wider industry.
The Bottom Line
The biggest issue in the new estimates is that analysts have reduced their earnings per share estimates, suggesting business headwinds lay ahead for China Tobacco International (HK). Regrettably, they also downgraded their revenue estimates, and the latest forecasts imply the business will grow sales slower than the wider market. After such a stark change in sentiment from analysts, we’d understand if readers now felt a bit wary of China Tobacco International (HK).
Still, the long-term prospects of the business are much more relevant than next year’s earnings. We have estimates – from multiple China Tobacco International (HK) analysts – going out to 2028, 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 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.
