Huali Industrial Group Company Limited (SZSE:300979) came out with its full-year results last week, and we wanted to see how the business is performing and what industry forecasters think of the company following this report. Huali Industrial Group reported in line with analyst predictions, delivering revenues of CN¥20b and statutory earnings per share of CN¥2.74, suggesting the business is executing well and in line with its plan. 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. We thought readers would find it interesting to see the analysts latest (statutory) post-earnings forecasts for next year.
Following the latest results, Huali Industrial Group's eleven analysts are now forecasting revenues of CN¥23.5b in 2024. This would be a meaningful 17% improvement in revenue compared to the last 12 months. Per-share earnings are expected to swell 17% to CN¥3.20. In the lead-up to this report, the analysts had been modelling revenues of CN¥23.3b and earnings per share (EPS) of CN¥3.19 in 2024. So it's pretty clear that, although the analysts have updated their estimates, there's been no major change in expectations for the business following the latest results.
The consensus price target rose 6.1% to CN¥72.32despite there being no meaningful change to earnings estimates. It could be that the analystsare reflecting the predictability of Huali Industrial Group's earnings by assigning a price premium. 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 Huali Industrial Group at CN¥77.00 per share, while the most bearish prices it at CN¥66.01. The narrow spread of estimates could suggest that the business' future is relatively easy to value, or thatthe analysts have a strong view on its prospects.
Of course, another way to look at these forecasts is to place them into context against the industry itself. The analysts are definitely expecting Huali Industrial Group's growth to accelerate, with the forecast 17% annualised growth to the end of 2024 ranking favourably alongside historical growth of 11% per annum over the past five years. Compare this with other companies in the same industry, which are forecast to grow their revenue 15% annually. Huali Industrial Group is expected to grow at about the same rate as its industry, so it's not clear that we can draw any conclusions from its growth relative to competitors.
The Bottom Line
The most obvious conclusion is that there's been no major change in the business' prospects in recent times, with the analysts holding their earnings forecasts steady, in line with previous estimates. They also reconfirmed their revenue estimates, with the company predicted to grow at about the same rate as 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.
With that said, the long-term trajectory of the company's earnings is a lot more important than next year. We have forecasts for Huali Industrial Group going out to 2026, and you can see them free on our platform here.
It is also worth noting that we have found 1 warning sign for Huali Industrial Group that you need to take into consideration.
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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.