Last week, you might have seen that Fosun Tourism Group (HKG:1992) released its half-year result to the market. The early response was not positive, with shares down 5.3% to HK$3.40 in the past week. Revenues came in 3.1% below expectations, at CN¥9.4b. Statutory earnings per share were relatively better off, with a per-share profit of CN¥0.25 being roughly in line with analyst 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.
Following the latest results, Fosun Tourism Group's seven analysts are now forecasting revenues of CN¥18.5b in 2024. This would be a modest 4.8% improvement in revenue compared to the last 12 months. Statutory earnings per share are predicted to shoot up 116% to CN¥0.27. Before this earnings report, the analysts had been forecasting revenues of CN¥19.2b and earnings per share (EPS) of CN¥0.29 in 2024. It's pretty clear that pessimism has reared its head after the latest results, leading to a weaker revenue outlook and a small dip in earnings per share estimates.
It'll come as no surprise then, to learn that the analysts have cut their price target 21% to HK$8.08. The consensus price target is just an average of individual analyst targets, so - it could be handy to see how wide the range of underlying estimates is. Currently, the most bullish analyst values Fosun Tourism Group at HK$11.53 per share, while the most bearish prices it at HK$5.50. 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.
Taking a look at the bigger picture now, one of the ways we can understand these forecasts is to see how they compare to both past performance and industry growth estimates. The analysts are definitely expecting Fosun Tourism Group's growth to accelerate, with the forecast 9.8% annualised growth to the end of 2024 ranking favourably alongside historical growth of 4.2% per annum over the past five years. Compare this with other companies in the same industry, which are forecast to see revenue growth of 12% annually. It seems obvious that, while the future growth outlook is brighter than the recent past, Fosun Tourism Group is expected to grow slower than the wider industry.
The Bottom Line
The biggest concern is that the analysts reduced their earnings per share estimates, suggesting business headwinds could lay ahead for Fosun Tourism Group. On the negative side, they also downgraded their revenue estimates, and forecasts imply they will perform worse than the wider industry. Furthermore, the analysts also cut their price targets, suggesting that the latest news has led to greater pessimism about the intrinsic value of the business.
With that said, the long-term trajectory of the company's earnings is a lot more important than next year. We have forecasts for Fosun Tourism Group going out to 2026, and you can see them free on our platform here.
You still need to take note of risks, for example - Fosun Tourism Group has 2 warning signs (and 1 which is significant) we think 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.
