Shareholders in Chongqing Baiya Sanitary Products Co., Ltd. (SZSE:003006) may be thrilled to learn that the analysts have just delivered a major upgrade to their near-term forecasts. The revenue forecast for this year has experienced a facelift, with the analysts now much more optimistic on its sales pipeline.

Following the upgrade, the latest consensus from Chongqing Baiya Sanitary Products' six analysts is for revenues of CN¥3.1b in 2024, which would reflect a meaningful 12% improvement in sales compared to the last 12 months. Statutory earnings per share are presumed to expand 14% to CN¥0.76. Prior to this update, the analysts had been forecasting revenues of CN¥2.7b and earnings per share (EPS) of CN¥0.70 in 2024. The most recent forecasts are noticeably more optimistic, with a nice increase in revenue estimates and a lift to earnings per share as well.

With these upgrades, we're not surprised to see that the analysts have lifted their price target 15% to CN¥25.50 per share.

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. We would highlight that Chongqing Baiya Sanitary Products' revenue growth is expected to slow, with the forecast 12% annualised growth rate until the end of 2024 being well below the historical 22% p.a. growth over the last three years. By way of comparison, the other companies in this industry with analyst coverage are forecast to grow their revenue at 16% per year. Factoring in the forecast slowdown in growth, it seems obvious that Chongqing Baiya Sanitary Products is also expected to grow slower than other industry participants.

The Bottom Line

The most important thing to take away from this upgrade is that analysts upgraded their earnings per share estimates for this year, expecting improving business conditions. Fortunately, they also upgraded their revenue estimates, and are forecasting revenues to grow slower than the wider market. There was also a nice increase in the price target, with analysts apparently feeling that the intrinsic value of the business is improving. Seeing the dramatic upgrade to this year's forecasts, it might be time to take another look at Chongqing Baiya Sanitary Products.

Even so, the longer term trajectory of the business is much more important for the value creation of shareholders. We have estimates - from multiple Chongqing Baiya Sanitary Products analysts - going out to 2026, and you can see them 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 backed by insiders.

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