China's Railway Signal Q3 profit drops on R&D spending

Overview

• China rail signaling equipment maker's Q3 revenue declined 1.8% yr/yr

• Net profit attributable to shareholders dropped 17.5% yr/yr

• Q3 EPS fell 28.6% yr/yr, financial statements are unaudited

Outlook

• Company did not provide specific guidance or outlook for future quarters or full yr in the press release

Result Drivers

• REVENUE DECLINE - Co's Q3 revenue fell 1.8% yr/yr

• PROFIT DROP - Net profit attributable to shareholders declined 17.5% yr/yr

• R&D SPENDING - Research and development investment rose 5.4% yr/yr, with R&D as a percentage of revenue up 0.5 percentage points

Company press release: Full Story

Key Details

Analyst Coverage

• The current average analyst rating on the shares is "strong buy" and the breakdown of recommendations is 3 "strong buy" or "buy", no "hold" and no "sell" or "strong sell"

• The average consensus recommendation for the industrial machinery & equipment peer group is "buy."

• Wall Street's median 12-month price target for China Railway Signal & Communication Corp Ltd is CNY6.08, about 22.5% above its October 27 closing price of CNY4.96

• The stock recently traded at 13 times the next 12-month earnings vs. a P/E of 12 three months ago

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(This story was created using Reuters automation and AI based on LSEG and company data. It was checked and edited by a Reuters journalist prior to publication.)