Investors in China Medical System Holdings Limited (HKG:867) had a good week, as its shares rose 8.4% to close at HK$7.23 following the release of its half-year results. It was a credible result overall, with revenues of CN¥3.6b and statutory earnings per share of CN¥0.98 both in line with analyst estimates, showing that China Medical System Holdings is executing in line with expectations. This is an important time for investors, as they can track a company's performance in its report, look at what experts are forecasting for next year, and see if there has been any change to expectations for the business. With this in mind, we've gathered the latest statutory forecasts to see what the analysts are expecting for next year.

Taking into account the latest results, the current consensus from China Medical System Holdings' nine analysts is for revenues of CN¥7.96b in 2024. This would reflect a decent 13% increase on its revenue over the past 12 months. Per-share earnings are expected to shoot up 25% to CN¥0.71. In the lead-up to this report, the analysts had been modelling revenues of CN¥7.94b and earnings per share (EPS) of CN¥0.72 in 2024. The consensus analysts don't seem to have seen anything in these results that would have changed their view on the business, given there's been no major change to their estimates.

The analysts reconfirmed their price target of HK$10.94, showing that the business is executing well and in line with expectations. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. There are some variant perceptions on China Medical System Holdings, with the most bullish analyst valuing it at HK$14.00 and the most bearish at HK$7.80 per share. 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 China Medical System Holdings' growth to accelerate, with the forecast 29% annualised growth to the end of 2024 ranking favourably alongside historical growth of 7.4% per annum over the past five years. Compare this with other companies in the same industry, which are forecast to grow their revenue 9.7% annually. Factoring in the forecast acceleration in revenue, it's pretty clear that China Medical System Holdings is expected to grow much faster than its industry.

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. Happily, there were no major changes to revenue forecasts, with the business still expected to grow faster than the wider industry. There was no real change to the consensus price target, suggesting that the intrinsic value of the business has not undergone any major changes with the latest estimates.

With that in mind, we wouldn't be too quick to come to a conclusion on China Medical System Holdings. Long-term earnings power is much more important than next year's profits. We have forecasts for China Medical System Holdings going out to 2026, and you can see them free on our platform here.

Before you take the next step you should know about the 2 warning signs for China Medical System Holdings that we have uncovered.

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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.