Suzhou TFC Optical Communication Co., Ltd. (SZSE:300394) shareholders will have a reason to smile today, with the analysts making substantial upgrades to this year's forecasts. The consensus statutory numbers for both revenue and earnings per share (EPS) increased, with their view clearly much more bullish on the company's business prospects.
Following the upgrade, the latest consensus from Suzhou TFC Optical Communication's twelve analysts is for revenues of CN¥3.7b in 2024, which would reflect a major 53% improvement in sales compared to the last 12 months. Per-share earnings are expected to soar 51% to CN¥3.52. Prior to this update, the analysts had been forecasting revenues of CN¥3.1b and earnings per share (EPS) of CN¥2.82 in 2024. So we can see there's been a pretty clear increase in analyst sentiment in recent times, with both revenues and earnings per share receiving a decent lift in the latest estimates.
With these upgrades, we're not surprised to see that the analysts have lifted their price target 10% to CN¥119 per share.
Looking at the bigger picture now, one of the ways we can make sense of these forecasts is to see how they measure up against both past performance and industry growth estimates. It's clear from the latest estimates that Suzhou TFC Optical Communication's rate of growth is expected to accelerate meaningfully, with the forecast 77% annualised revenue growth to the end of 2024 noticeably faster than its historical growth of 28% p.a. over the past five years. Compare this with other companies in the same industry, which are forecast to grow their revenue 22% annually. Factoring in the forecast acceleration in revenue, it's pretty clear that Suzhou TFC Optical Communication is expected to grow much faster than its industry.
The Bottom Line
The biggest takeaway for us from these new estimates is that analysts upgraded their earnings per share estimates, with improved earnings power expected for this year. They also upgraded their revenue estimates for this year, and sales are expected to grow faster than the wider market. Given that the consensus looks almost universally bullish, with a substantial increase to forecasts and a higher price target, Suzhou TFC Optical Communication could be worth investigating further.
Analysts are clearly in love with Suzhou TFC Optical Communication at the moment, but before diving in - you should be aware that we've identified some warning flags with the business, such as concerns around earnings quality. You can learn more, and discover the 1 other concern we've identified, for free on our platform here.
Another way to search for interesting companies that could be reaching an inflection point is to track whether management are buying or selling, with our free list of growing companies that insiders are buying.
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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.