Shennan Circuit Company Limited (SZSE:002916) just released its latest quarterly results and things are looking bullish. The company beat forecasts, with revenue of CN¥4.4b, some 9.6% above estimates, and statutory earnings per share (EPS) coming in at CN¥1.19, 38% ahead of expectations. 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.

Taking into account the latest results, the most recent consensus for Shennan Circuit from 14 analysts is for revenues of CN¥16.6b in 2024. If met, it would imply an okay 5.2% increase on its revenue over the past 12 months. Statutory per-share earnings are expected to be CN¥3.79, roughly flat on the last 12 months. Yet prior to the latest earnings, the analysts had been anticipated revenues of CN¥16.2b and earnings per share (EPS) of CN¥3.43 in 2024. There's been a pretty noticeable increase in sentiment, with the analysts upgrading revenues and making a decent improvement in earnings per share in particular.

Althoughthe analysts have upgraded their earnings estimates, there was no change to the consensus price target of CN¥99.07, suggesting that the forecast performance does not have a long term impact on the company's valuation. 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 Shennan Circuit analyst has a price target of CN¥130 per share, while the most pessimistic values it at CN¥68.00. This is a fairly broad spread of estimates, suggesting that analysts are forecasting a wide range of possible outcomes for the business.

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 Shennan Circuit's growth to accelerate, with the forecast 11% annualised growth to the end of 2024 ranking favourably alongside historical growth of 7.8% per annum over the past five years. Compare this with other companies in the same industry, which are forecast to see revenue growth of 18% annually. So it's clear that despite the acceleration in growth, Shennan Circuit is expected to grow meaningfully slower than the industry average.

The Bottom Line

The biggest takeaway for us is the consensus earnings per share upgrade, which suggests a clear improvement in sentiment around Shennan Circuit's earnings potential next year. Fortunately, they also upgraded their revenue estimates, although our data indicates it is expected to perform worse than the wider industry. The consensus price target held steady at CN¥99.07, with the latest estimates not enough to have an impact on their price targets.

With that said, the long-term trajectory of the company's earnings is a lot more important than next year. At Simply Wall St, we have a full range of analyst estimates for Shennan Circuit 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 Shennan Circuit 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.