It's been a good week for Ningbo Deye Technology Group Co., Ltd. (SHSE:605117) shareholders, because the company has just released its latest quarterly results, and the shares gained 2.1% to CN¥91.22. Results were roughly in line with estimates, with revenues of CN¥2.9b and statutory earnings per share of CN¥2.98. Following the result, the analysts have updated their earnings model, and it would be good to know whether they think there's been a strong change in the company's prospects, or if it's business as usual. So we gathered the latest post-earnings forecasts to see what estimates suggest is in store for next year.
Following the latest results, Ningbo Deye Technology Group's seven analysts are now forecasting revenues of CN¥12.1b in 2024. This would be a sizeable 65% improvement in revenue compared to the last 12 months. Statutory earnings per share are predicted to leap 78% to CN¥4.91. In the lead-up to this report, the analysts had been modelling revenues of CN¥11.1b and earnings per share (EPS) of CN¥4.11 in 2024. So it seems there's been a definite increase in optimism about Ningbo Deye Technology Group's future following the latest results, with a nice gain to the earnings per share forecasts in particular.
It will come as no surprise to learn that the analysts have increased their price target for Ningbo Deye Technology Group 17% to CN¥105on the back of these upgrades. 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. There are some variant perceptions on Ningbo Deye Technology Group, with the most bullish analyst valuing it at CN¥105 and the most bearish at CN¥104 per share. With such a narrow range of valuations, the analysts apparently share similar views on what they think the business is worth.
These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Ningbo Deye Technology Group's past performance and to peers in the same industry. The analysts are definitely expecting Ningbo Deye Technology Group's growth to accelerate, with the forecast 172% annualised growth to the end of 2024 ranking favourably alongside historical growth of 28% 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 16% per year. Factoring in the forecast acceleration in revenue, it's pretty clear that Ningbo Deye Technology Group is expected to grow much faster than its industry.
The Bottom Line
The biggest takeaway for us is the consensus earnings per share upgrade, which suggests a clear improvement in sentiment around Ningbo Deye Technology Group's earnings potential next year. Pleasantly, they also upgraded their revenue estimates, and their forecasts suggest the business is expected 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.
Following on from that line of thought, we think that the long-term prospects of the business are much more relevant than next year's earnings. At Simply Wall St, we have a full range of analyst estimates for Ningbo Deye Technology Group going out to 2026, and you can see them free on our platform here..
Even so, be aware that Ningbo Deye Technology Group is showing 4 warning signs in our investment analysis , and 1 of those shouldn't be ignored...
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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.