It's been a good week for BYD Company Limited (HKG:1211) shareholders, because the company has just released its latest quarterly results, and the shares gained 9.2% to HK$216. Revenues CN¥125b disappointed slightly, at5.1% below what the analysts had predicted. Profits were a relative bright spot, with statutory per-share earnings of CN¥1.57 coming in 14% above what was anticipated. The analysts typically update their forecasts at each earnings report, and we can judge from their estimates whether their view of the company has changed or if there are any new concerns to be aware of. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether the analysts have changed their mind on BYD after the latest results.

Taking into account the latest results, the current consensus from BYD's 25 analysts is for revenues of CN¥716.4b in 2024. This would reflect a solid 18% increase on its revenue over the past 12 months. Per-share earnings are expected to climb 12% to CN¥11.73. Before this earnings report, the analysts had been forecasting revenues of CN¥748.3b and earnings per share (EPS) of CN¥11.85 in 2024. So it looks like the analysts have become a bit less optimistic after the latest results announcement, with revenues expected to fall even as the company is supposed to maintain EPS.

The average price target was steady at HK$289even though revenue estimates declined; likely suggesting the analysts place a higher value on earnings. 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. The most optimistic BYD analyst has a price target of HK$457 per share, while the most pessimistic values it at HK$160. As you can see the range of estimates is wide, with the lowest valuation coming in at less than half the most bullish estimate, suggesting there are some strongly diverging views on how analysts think this business will perform. As a result it might not be a great idea to make decisions based on the consensus price target, which is after all just an average of this wide range of estimates.

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the BYD's past performance and to peers in the same industry. It's pretty clear that there is an expectation that BYD's revenue growth will slow down substantially, with revenues to the end of 2024 expected to display 25% growth on an annualised basis. This is compared to a historical growth rate of 37% 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) 13% per year. So it's pretty clear that, while BYD's revenue growth is expected to slow, it's still expected to grow faster than the industry itself.

The Bottom Line

The most important thing to take away is that there's been no major change in sentiment, with the analysts reconfirming that the business is performing in line with their previous earnings per share estimates. Regrettably, they also downgraded their revenue estimates, but the latest forecasts still imply the business will grow faster than the wider industry. Even so, earnings per share are more important to the intrinsic value of the business. There was no real change to the consensus price target, suggesting that the intrinsic value of the business has not undergone any major changes with the latest estimates.

Following on from that line of thought, we think that the long-term prospects of the business are much more relevant than next year's earnings. We have forecasts for BYD going out to 2026, and you can see them free on our platform here.

You can also see our analysis of BYD's Board and CEO remuneration and experience, and whether company insiders have been buying stock.

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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.