UTour Group Co., Ltd. Just Beat Revenue By 31%: Here's What Analysts Think Will Happen Next

It's been a good week for UTour Group Co., Ltd. (SZSE:002707) shareholders, because the company has just released its latest first-quarter results, and the shares gained 2.6% to CN¥6.66. UTour Group reported revenues of CN¥1.0b, which blew past expectations. Statutory earnings per share (EPS) of CN¥0.029 came in 3.3% short of forecasts. 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. With this in mind, we've gathered the latest statutory forecasts to see what the analysts are expecting for next year.

View our latest analysis for UTour Group

After the latest results, the three analysts covering UTour Group are now predicting revenues of CN¥7.49b in 2024. If met, this would reflect a substantial 79% improvement in revenue compared to the last 12 months. Statutory earnings per share are forecast to drop 14% to CN¥0.085 in the same period. Before this earnings report, the analysts had been forecasting revenues of CN¥7.49b and earnings per share (EPS) of CN¥0.14 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 pretty serious reduction to EPS estimates.

It might be a surprise to learn that the consensus price target was broadly unchanged at CN¥7.73, with the analysts clearly implying that the forecast decline in earnings is not expected to have much of an impact on valuation. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. The most optimistic UTour Group analyst has a price target of CN¥9.40 per share, while the most pessimistic values it at CN¥5.80. Analysts definitely have varying views on the business, but the spread of estimates is not wide enough in our view to suggest that extreme outcomes could await UTour Group shareholders.

Taking a look at the bigger picture now, one of the ways we can understand these forecasts is to see how they compare to both past performance and industry growth estimates. One thing stands out from these estimates, which is that UTour Group is forecast to grow faster in the future than it has in the past, with revenues expected to display 117% annualised growth until the end of 2024. If achieved, this would be a much better result than the 54% annual decline over the past five years. Compare this against analyst estimates for the broader industry, which suggest that (in aggregate) industry revenues are expected to grow 16% annually. Not only are UTour Group's revenues expected to improve, it seems that the analysts are also expecting it to grow faster than the wider industry.

The Bottom Line

The biggest concern is that the analysts reduced their earnings per share estimates, suggesting business headwinds could lay ahead for UTour Group. Fortunately, they also reconfirmed their revenue numbers, suggesting that it's tracking in line with expectations. Additionally, our data suggests that revenue is expected 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.

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 UTour Group going out to 2025, and you can see them free on our platform here..

We also provide an overview of the UTour Group Board and CEO remuneration and length of tenure at the company, and whether insiders have been buying the stock, here.

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.