Earnings Update: Here's Why Analysts Just Lifted Their Avicopter Plc (SHSE:600038) Price Target To CN¥47.00

Shareholders of Avicopter Plc (SHSE:600038) will be pleased this week, given that the stock price is up 12% to CN¥42.48 following its latest full-year results. It was a credible result overall, with revenues of CN¥23b and statutory earnings per share of CN¥0.75 both in line with analyst estimates, showing that Avicopter is executing in line with 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. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether the analysts have changed their mind on Avicopter after the latest results.

View our latest analysis for Avicopter

After the latest results, the four analysts covering Avicopter are now predicting revenues of CN¥27.7b in 2024. If met, this would reflect a solid 19% improvement in revenue compared to the last 12 months. Statutory earnings per share are predicted to leap 23% to CN¥0.93. Before this earnings report, the analysts had been forecasting revenues of CN¥28.1b and earnings per share (EPS) of CN¥1.17 in 2024. The analysts seem to have become more bearish following the latest results. While there were no changes to revenue forecasts, there was a large cut to EPS estimates.

Althoughthe analysts have revised their earnings forecasts for next year, they've also lifted the consensus price target 17% to CN¥47.00, suggesting the revised estimates are not indicative of a weaker long-term future for the business.

One way to get more context on these forecasts is to look at how they compare to both past performance, and how other companies in the same industry are performing. The analysts are definitely expecting Avicopter's growth to accelerate, with the forecast 19% annualised growth to the end of 2024 ranking favourably alongside historical growth of 10% per annum over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to grow their revenue at 25% per year. So it's clear that despite the acceleration in growth, Avicopter is expected to grow meaningfully slower than the industry average.

The Bottom Line

The most important thing to take away is that the analysts downgraded their earnings per share estimates, showing that there has been a clear decline in sentiment following these results. On the plus side, there were no major changes to revenue estimates; although forecasts imply they will perform worse than the wider industry. There was also a nice increase in the price target, with the analysts clearly feeling that the intrinsic value of the business is improving.

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 Avicopter analysts - going out to 2026, and you can see them free on our platform here.

You can also see our analysis of Avicopter's Board and CEO remuneration and experience, and whether company insiders have been buying stock.

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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.