It's been a pretty great week for ANTA Sports Products Limited (HKG:2020) shareholders, with its shares surging 10% to HK$76.30 in the week since its latest half-year results. Results overall were respectable, with statutory earnings of CN¥3.60 per share roughly in line with what the analysts had forecast. Revenues of CN¥34b came in 3.2% ahead of analyst predictions. 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 consensus forecast from ANTA Sports Products' 40 analysts is for revenues of CN¥70.4b in 2024. This reflects a modest 5.9% improvement in revenue compared to the last 12 months. Statutory per share are forecast to be CN¥4.61, approximately in line with the last 12 months. In the lead-up to this report, the analysts had been modelling revenues of CN¥70.5b and earnings per share (EPS) of CN¥4.52 in 2024. So the consensus seems to have become somewhat more optimistic on ANTA Sports Products' earnings potential following these results.
There's been no major changes to the consensus price target of HK$108, suggesting that the improved earnings per share outlook is not enough to have a long-term positive impact on the stock's valuation. That's not the only conclusion we can draw from this data however, as some investors also like to consider the spread in estimates when evaluating analyst price targets. The most optimistic ANTA Sports Products analyst has a price target of HK$142 per share, while the most pessimistic values it at HK$76.50. 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.
Looking at the bigger picture now, one of the ways we can make sense of these forecasts is to see how they measure up against both past performance and industry growth estimates. It's pretty clear that there is an expectation that ANTA Sports Products' revenue growth will slow down substantially, with revenues to the end of 2024 expected to display 12% growth on an annualised basis. This is compared to a historical growth rate of 16% over the past five years. Compare this to the 113 other companies in this industry with analyst coverage, which are forecast to grow their revenue at 9.8% per year. Factoring in the forecast slowdown in growth, it looks like ANTA Sports Products is forecast to grow at about the same rate as the wider industry.
The Bottom Line
The biggest takeaway for us is the consensus earnings per share upgrade, which suggests a clear improvement in sentiment around ANTA Sports Products' earnings potential next year. They also reconfirmed their revenue estimates, with the company predicted to grow at about the same rate as 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 said, the long-term trajectory of the company's earnings is a lot more important than next year. We have forecasts for ANTA Sports Products going out to 2026, and you can see them free on our platform here.
Another thing to consider is whether management and directors have been buying or selling stock recently. We provide an overview of all open market stock trades for the last twelve months on our platform, here.
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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.
