It's been a pretty great week for HUYA Inc. (NYSE:HUYA) shareholders, with its shares surging 17% to US$4.76 in the week since its latest quarterly results. Results overall were not great, with earnings of CN¥0.13 per share falling drastically short of analyst expectations. Meanwhile revenues hit CN¥1.5b and were slightly better than forecasts. 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. With this in mind, we've gathered the latest statutory forecasts to see what the analysts are expecting for next year.

Following last week's earnings report, HUYA's 13 analysts are forecasting 2024 revenues to be CN¥6.26b, approximately in line with the last 12 months. HUYA is also expected to turn profitable, with statutory earnings of CN¥0.82 per share. In the lead-up to this report, the analysts had been modelling revenues of CN¥6.43b and earnings per share (EPS) of CN¥0.96 in 2024. The analysts seem less optimistic after the recent results, reducing their revenue forecasts and making a substantial drop in earnings per share numbers.

The average price target climbed 5.3% to US$6.23despite the reduced earnings forecasts, suggesting that this earnings impact could be a positive for the stock, once it passes. 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 HUYA at US$9.12 per share, while the most bearish prices it at US$5.01. With such a narrow range of valuations, the analysts apparently share similar views on what they think the business is worth.

One way to get more context on these forecasts is to look at how they compare to both past performance, and how other companies in the same industry are performing. It's also worth noting that the years of declining revenue look to have come to an end, with the forecast stauing flat to the end of 2024. Historically, HUYA's top line has shrunk approximately 3.5% annually over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to see their revenue grow 8.9% per year. So it's pretty clear that, although revenues are improving, HUYA is still expected to grow slower than the industry.

The Bottom Line

The most important thing to take away is that the analysts downgraded their earnings per share estimates, showing that there has been a clear decline in sentiment following these results. On the negative side, they also downgraded their revenue estimates, and forecasts imply they will perform worse than the wider industry. There was also a nice increase in the price target, with the analysts clearly feeling that the intrinsic value of the business is improving.

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 forecasts for HUYA going out to 2026, and you can see them free on our platform here.

We also provide an overview of the HUYA Board and CEO remuneration and length of tenure at the company, and whether insiders have been buying the stock, 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.