It's been a sad week for Minth Group Limited (HKG:425), who've watched their investment drop 13% to HK$12.36 in the week since the company reported its annual result. Results look mixed - while revenue fell marginally short of analyst estimates at CN¥21b, statutory earnings were in line with expectations, at CN¥1.65 per share. This is an important time for investors, as they can track a company's performance in its report, look at what experts are forecasting for next year, and see if there has been any change to expectations for the business. So we collected the latest post-earnings statutory consensus estimates to see what could be in store for next year.
Taking into account the latest results, the current consensus from Minth Group's 16 analysts is for revenues of CN¥25.3b in 2024. This would reflect a huge 23% increase on its revenue over the past 12 months. Statutory earnings per share are predicted to soar 20% to CN¥1.97. In the lead-up to this report, the analysts had been modelling revenues of CN¥25.4b and earnings per share (EPS) of CN¥2.01 in 2024. The consensus analysts don't seem to have seen anything in these results that would have changed their view on the business, given there's been no major change to their estimates.
With no major changes to earnings forecasts, the consensus price target fell 7.7% to HK$24.90, suggesting that the analysts might have previously been hoping for an earnings upgrade. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. Currently, the most bullish analyst values Minth Group at HK$31.14 per share, while the most bearish prices it at HK$15.50. Note the wide gap in analyst price targets? This implies to us that there is a fairly broad range of possible scenarios for the underlying business.
These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Minth Group's past performance and to peers in the same industry. It's clear from the latest estimates that Minth Group's rate of growth is expected to accelerate meaningfully, with the forecast 23% annualised revenue growth to the end of 2024 noticeably faster than its historical growth of 11% p.a. over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to grow their revenue at 10% per year. Factoring in the forecast acceleration in revenue, it's pretty clear that Minth Group is expected to grow much faster than its industry.
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. 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. The consensus price target fell measurably, with the analysts seemingly not reassured by the latest results, leading to a lower estimate of Minth Group's future valuation.
Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. We have forecasts for Minth Group going out to 2026, and you can see them free on our platform here.
It might also be worth considering whether Minth Group's debt load is appropriate, using our debt analysis tools on the Simply Wall St platform, here.
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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.