Darbond Technology: Steady Revenue but Net Income and EPS Trend Downward – Risk Analysis Needed

Darbond Technology (SHSE:688035) reported a revenue of CN¥932.0m for the full year 2023, which remained flat compared to FY 2022. However, the net income decreased by 16% to CN¥102.9m, with a profit margin of 11%, down from 13% in FY 2022. Additionally, the earnings per share (EPS) dropped to CN¥0.72 from CN¥1.06 in FY 2022.

On April 22nd, 2024, it was observed that revenue missed analyst estimates by 3.4%, while EPS also fell short by 17%. Despite this setback, the forecast for the next two years shows an expected average annual revenue growth of 18% for Darbond Technology, surpassing the industry’s growth forecast of just 16%.

However, there are concerns about the performance of the Chinese Chemicals industry as shares have declined by a staggering 8.9% from a week ago. As such, it is crucial to conduct a risk analysis for Darbond Technology to determine if it is potentially over or undervalued based on warning signs identified and its valuation. It is essential to consider these factors when making investment decisions.

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In conclusion, Darbond Technology’s revenue remains stagnant while net income decreases and earnings per share drops significantly compared to last year’s figures. Despite missing analyst estimates in Q4 of FY ’24 and industry decline in shares from a week ago; Darbond technology has an expected average annual revenue growth rate of approximately 18% over the next two years exceeding industry growth forecasts.

It is vital to conduct a thorough risk analysis for Darbond Technology considering warning signs identified and its valuation before making any investment decisions.