Investors in Proya Cosmetics Co.,Ltd. (SHSE:603605) had a good week, as its shares rose 8.3% to close at CN¥90.72 following the release of its second-quarter results. Results overall were respectable, with statutory earnings of CN¥0.97 per share roughly in line with what the analysts had forecast. Revenues of CN¥2.8b came in 7.6% ahead of analyst predictions. 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. 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 most recent consensus for Proya CosmeticsLtd from 28 analysts is for revenues of CN¥11.7b in 2024. If met, it would imply a solid 13% increase on its revenue over the past 12 months. Per-share earnings are expected to accumulate 9.9% to CN¥3.89. Before this earnings report, the analysts had been forecasting revenues of CN¥11.3b and earnings per share (EPS) of CN¥3.86 in 2024. There doesn't appear to have been a major change in sentiment following the results, other than the small lift in revenue estimates.

It may not be a surprise to see thatthe analysts have reconfirmed their price target of CN¥135, implying that the uplift in revenue is not expected to greatly contribute to Proya CosmeticsLtd's valuation in the near term. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. Currently, the most bullish analyst values Proya CosmeticsLtd at CN¥178 per share, while the most bearish prices it at CN¥109. These price targets show that analysts do have some differing views on the business, but the estimates do not vary enough to suggest to us that some are betting on wild success or utter failure.

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 period to the end of 2024 brings more of the same, according to the analysts, with revenue forecast to display 29% growth on an annualised basis. That is in line with its 27% annual growth over the past five years. Compare this with the broader industry, which analyst estimates (in aggregate) suggest will see revenues grow 16% annually. So it's pretty clear that Proya CosmeticsLtd is forecast to grow substantially 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, they also upgraded their revenue estimates, and are forecasting them 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.

Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. We have estimates - from multiple Proya CosmeticsLtd analysts - going out to 2026, and you can see them free on our platform here.

You should always think about risks though. Case in point, we've spotted 2 warning signs for Proya CosmeticsLtd you should be aware of, and 1 of them is a bit concerning.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.
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.