There's been a notable change in appetite for Hang Lung Properties Limited (HKG:101) shares in the week since its half-year report, with the stock down 10% to HK$5.75. Statutory earnings per share disappointed, coming in -51% short of expectations, at HK$0.23. Fortunately revenue performance was a lot stronger at HK$6.1b arriving 20% ahead of predictions. 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.

After the latest results, the 14 analysts covering Hang Lung Properties are now predicting revenues of HK$11.7b in 2024. If met, this would reflect a satisfactory 4.4% improvement in revenue compared to the last 12 months. Per-share earnings are expected to bounce 25% to HK$0.70. Before this earnings report, the analysts had been forecasting revenues of HK$12.1b and earnings per share (EPS) of HK$0.95 in 2024. From this we can that sentiment has definitely become more bearish after the latest results, leading to lower revenue forecasts and a large cut to earnings per share estimates.

It'll come as no surprise then, to learn that the analysts have cut their price target 29% to HK$7.55. There's another way to think about price targets though, and that's to look at the range of price targets put forward by analysts, because a wide range of estimates could suggest a diverse view on possible outcomes for the business. The most optimistic Hang Lung Properties analyst has a price target of HK$11.60 per share, while the most pessimistic values it at HK$5.30. This is a fairly broad spread of estimates, suggesting that analysts are forecasting a wide range of possible outcomes for the business.

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Hang Lung Properties' past performance and to peers in the same industry. The analysts are definitely expecting Hang Lung Properties' growth to accelerate, with the forecast 9.0% annualised growth to the end of 2024 ranking favourably alongside historical growth of 5.1% per annum over the past five years. Compare this with other companies in the same industry, which are forecast to grow their revenue 5.0% annually. It seems obvious that, while the growth outlook is brighter than the recent past, the analysts also expect Hang Lung Properties to grow faster than the wider 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. They also downgraded Hang Lung Properties' revenue estimates, but industry data suggests that it 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 Hang Lung Properties' future valuation.

With that in mind, we wouldn't be too quick to come to a conclusion on Hang Lung Properties. Long-term earnings power is much more important than next year's profits. We have estimates - from multiple Hang Lung Properties analysts - going out to 2026, and you can see them free on our platform here.

Plus, you should also learn about the 3 warning signs we've spotted with Hang Lung Properties (including 1 which can't be ignored) .

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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.

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