Yuexiu Services Group Limited (HKG:6626) last week reported its latest full-year results, which makes it a good time for investors to dive in and see if the business is performing in line with expectations. Yuexiu Services Group reported in line with analyst predictions, delivering revenues of CN¥3.2b and statutory earnings per share of CN¥0.32, suggesting the business is executing well and in line with its plan. Earnings are an important time for investors, as they can track a company's performance, look at what the analysts are forecasting for next year, and see if there's been a change in sentiment towards the company. With this in mind, we've gathered the latest statutory forecasts to see what the analysts are expecting for next year.

Taking into account the latest results, the current consensus from Yuexiu Services Group's five analysts is for revenues of CN¥3.92b in 2024. This would reflect a major 21% increase on its revenue over the past 12 months. Statutory earnings per share are predicted to climb 18% to CN¥0.38. Before this earnings report, the analysts had been forecasting revenues of CN¥3.98b and earnings per share (EPS) of CN¥0.39 in 2024. So it looks like there's been a small decline in overall sentiment after the recent results - there's been no major change to revenue estimates, but the analysts did make a small dip in their earnings per share forecasts.

It might be a surprise to learn that the consensus price target was broadly unchanged at HK$4.41, with the analysts clearly implying that the forecast decline in earnings is not expected to have much of an impact on valuation. Fixating on a single price target can be unwise though, since the consensus target is effectively the average of analyst price targets. As a result, some investors like to look at the range of estimates to see if there are any diverging opinions on the company's valuation. Currently, the most bullish analyst values Yuexiu Services Group at HK$4.60 per share, while the most bearish prices it at HK$4.14. Even so, with a relatively close grouping of estimates, it looks like the analysts are quite confident in their valuations, suggesting Yuexiu Services Group is an easy business to forecast or the the analysts are all using similar assumptions.

Of course, another way to look at these forecasts is to place them into context against the industry itself. We would highlight that Yuexiu Services Group's revenue growth is expected to slow, with the forecast 21% annualised growth rate until the end of 2024 being well below the historical 28% p.a. growth over the last five years. By way of comparison, the other companies in this industry with analyst coverage are forecast to grow their revenue at 6.7% annually. Even after the forecast slowdown in growth, it seems obvious that Yuexiu Services Group is also expected to grow faster than the wider industry.

The Bottom Line

The biggest concern is that the analysts reduced their earnings per share estimates, suggesting business headwinds could lay ahead for Yuexiu Services Group. Fortunately, they also reconfirmed their revenue numbers, suggesting that it's tracking in line with expectations. Additionally, our data suggests that revenue is expected to grow faster than the wider industry. 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 estimates - from multiple Yuexiu Services Group analysts - going out to 2026, and you can see them free on our platform here.

Don't forget that there may still be risks. For instance, we've identified 1 warning sign for Yuexiu Services Group that you should be aware of.

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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.