Investors in Tianshui Huatian Technology Co., Ltd. (SZSE:002185) had a good week, as its shares rose 5.7% to close at CN¥8.01 following the release of its yearly results. Revenues were CN¥11b, approximately in line with whatthe analysts expected, although statutory earnings per share (EPS) crushed expectations, coming in at CN¥0.071, an impressive 51% ahead of estimates. 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. 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 Tianshui Huatian Technology's six analysts is for revenues of CN¥12.9b in 2024. This would reflect a meaningful 14% increase on its revenue over the past 12 months. Per-share earnings are expected to surge 182% to CN¥0.20. In the lead-up to this report, the analysts had been modelling revenues of CN¥13.2b and earnings per share (EPS) of CN¥0.18 in 2024. There was no real change to the revenue estimates, but the analysts do seem more bullish on earnings, given the solid gain to earnings per share expectations following these results.

The consensus price target was unchanged at CN¥9.50, implying that the improved earnings outlook is not expected to have a long term impact on value creation for shareholders. 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 Tianshui Huatian Technology at CN¥12.00 per share, while the most bearish prices it at CN¥6.00. 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.

Another way we can view these estimates is in the context of the bigger picture, such as how the forecasts stack up against past performance, and whether forecasts are more or less bullish relative to other companies in the industry. The analysts are definitely expecting Tianshui Huatian Technology's growth to accelerate, with the forecast 14% annualised growth to the end of 2024 ranking favourably alongside historical growth of 11% per annum over the past five years. Compare this with other companies in the same industry, which are forecast to see revenue growth of 23% annually. So it's clear that despite the acceleration in growth, Tianshui Huatian Technology is expected to grow meaningfully slower than the industry average.

The Bottom Line

The biggest takeaway for us is the consensus earnings per share upgrade, which suggests a clear improvement in sentiment around Tianshui Huatian Technology's earnings potential next year. Fortunately, the analysts also reconfirmed their revenue estimates, suggesting that it's tracking in line with expectations. Although our data does suggest that Tianshui Huatian Technology's revenue is expected to perform worse than the wider industry. The consensus price target held steady at CN¥9.50, with the latest estimates not enough to have an impact on their price targets.

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. At Simply Wall St, we have a full range of analyst estimates for Tianshui Huatian Technology going out to 2026, and you can see them free on our platform here..

Even so, be aware that Tianshui Huatian Technology is showing 2 warning signs in our investment analysis , you should know about...

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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.