As you might know, Shanghai Chicmax Cosmetic Co., Ltd. (HKG:2145) just kicked off its latest full-year results with some very strong numbers. Results were good overall, with revenues beating analyst predictions by 3.3% to hit CN¥4.2b. Statutory earnings per share (EPS) came in at CN¥1.16, some 6.8% above whatthe analysts had expected. Earnings are an important time for investors, as they can track a company's performance, look at what the analysts are forecasting for next year, and see if there's been a change in sentiment towards the company. So we gathered the latest post-earnings forecasts to see what estimates suggest is in store for next year.
After the latest results, the six analysts covering Shanghai Chicmax Cosmetic are now predicting revenues of CN¥6.94b in 2024. If met, this would reflect a huge 66% improvement in revenue compared to the last 12 months. Statutory earnings per share are predicted to leap 65% to CN¥1.91. Before this earnings report, the analysts had been forecasting revenues of CN¥5.62b and earnings per share (EPS) of CN¥1.57 in 2024. There has definitely been an improvement in perception after these results, with the analysts noticeably increasing both their earnings and revenue estimates.
With these upgrades, we're not surprised to see that the analysts have lifted their price target 17% to HK$52.51per share. 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. The most optimistic Shanghai Chicmax Cosmetic analyst has a price target of HK$59.73 per share, while the most pessimistic values it at HK$46.78. Still, with such a tight range of estimates, it suggeststhe analysts have a pretty good idea of what they think the company is worth.
Another way we can view these estimates is in the context of the bigger picture, such as how the forecasts stack up against past performance, and whether forecasts are more or less bullish relative to other companies in the industry. The analysts are definitely expecting Shanghai Chicmax Cosmetic's growth to accelerate, with the forecast 66% annualised growth to the end of 2024 ranking favourably alongside historical growth of 2.0% per annum over the past three years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to grow their revenue at 8.9% per year. Factoring in the forecast acceleration in revenue, it's pretty clear that Shanghai Chicmax Cosmetic is expected to grow much faster than its industry.
The Bottom Line
The most important thing here is that the analysts upgraded their earnings per share estimates, suggesting that there has been a clear increase in optimism towards Shanghai Chicmax Cosmetic following these results. Happily, they also upgraded their revenue estimates, and are forecasting them to grow faster than the wider industry. We note an upgrade to the price target, suggesting that the analysts believes the intrinsic value of the business is likely to improve over time.
With that in mind, we wouldn't be too quick to come to a conclusion on Shanghai Chicmax Cosmetic. Long-term earnings power is much more important than next year's profits. We have estimates - from multiple Shanghai Chicmax Cosmetic analysts - going out to 2025, and you can see them free on our platform here.
Don't forget that there may still be risks. For instance, we've identified 1 warning sign for Shanghai Chicmax Cosmetic that you should be aware of.
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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.