Cambricon Technologies Corporation Limited (SHSE:688256) 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 most recent consensus for Cambricon Technologies from its four analysts is for revenues of CN¥1.4b in 2024 which, if met, would be a huge 101% increase on its sales over the past 12 months. Losses are predicted to fall substantially, shrinking 30% to CN¥1.42 per share. Yet before this consensus update, the analysts had been forecasting revenues of CN¥956m and losses of CN¥1.69 per share in 2024. So there's been quite a change-up of views after the recent consensus updates, with the analysts making a sizeable increase to their revenue forecasts while also reducing the estimated loss as the business grows towards breakeven.

The consensus price target rose 11% to CN¥127, with the analysts encouraged by the higher revenue and lower forecast losses for this year.

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 Cambricon Technologies' rate of growth is expected to accelerate meaningfully, with the forecast 101% annualised revenue growth to the end of 2024 noticeably faster than its historical growth of 20% 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 23% per year. Factoring in the forecast acceleration in revenue, it's pretty clear that Cambricon Technologies is expected to grow much faster than its industry.

The Bottom Line

The most important thing here is that analysts reduced their loss per share estimates for this year, reflecting increased optimism around Cambricon Technologies' prospects. They also upgraded their revenue estimates for this year, and sales are expected to grow faster than the wider market. With a serious upgrade to expectations and a rising price target, it might be time to take another look at Cambricon Technologies.

Better yet, Cambricon Technologies is expected to break-even soon - within the next few years - according to analyst forecasts, which would be a momentous event for shareholders. You can learn more about these forecasts, for free on our platform here.

Of course, seeing company management invest large sums of money in a stock can be just as useful as knowing whether analysts are upgrading their estimates. So you may also wish to search this free list of stocks that insiders are buying.

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