Results: Haier Smart Home Co., Ltd. Beat Earnings Expectations And Analysts Now Have New Forecasts

It's been a good week for Haier Smart Home Co., Ltd. (SHSE:600690) shareholders, because the company has just released its latest quarterly results, and the shares gained 7.8% to CN¥30.26. The result was positive overall - although revenues of CN¥69b were in line with what the analysts predicted, Haier Smart Home surprised by delivering a statutory profit of CN¥0.51 per share, modestly greater than expected. 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.

See our latest analysis for Haier Smart Home

Taking into account the latest results, the current consensus from Haier Smart Home's 27 analysts is for revenues of CN¥280.5b in 2024. This would reflect a credible 5.7% increase on its revenue over the past 12 months. Statutory earnings per share are predicted to accumulate 8.0% to CN¥2.04. Before this earnings report, the analysts had been forecasting revenues of CN¥281.1b and earnings per share (EPS) of CN¥2.00 in 2024. So the consensus seems to have become somewhat more optimistic on Haier Smart Home's earnings potential following these results.

There's been no major changes to the consensus price target of CN¥32.34, suggesting that the improved earnings per share outlook is not enough to have a long-term positive impact on the stock'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 Haier Smart Home analyst has a price target of CN¥40.70 per share, while the most pessimistic values it at CN¥24.00. As you can see, analysts are not all in agreement on the stock's future, but the range of estimates is still reasonably narrow, which could suggest that the outcome is not totally unpredictable.

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. The period to the end of 2024 brings more of the same, according to the analysts, with revenue forecast to display 7.7% growth on an annualised basis. That is in line with its 7.0% annual growth over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to see their revenues grow 9.3% per year. So although Haier Smart Home is expected to maintain its revenue growth rate, it's forecast to grow slower than the wider industry.

The Bottom Line

The most important thing here is that the analysts upgraded their earnings per share estimates, suggesting that there has been a clear increase in optimism towards Haier Smart Home 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. The consensus price target held steady at CN¥32.34, with the latest estimates not enough to have an impact on their price targets.

With that in mind, we wouldn't be too quick to come to a conclusion on Haier Smart Home. Long-term earnings power is much more important than next year's profits. At Simply Wall St, we have a full range of analyst estimates for Haier Smart Home 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.