Here's What Analysts Are Forecasting For 37 Interactive Entertainment Network Technology Group Co., Ltd. (SZSE:002555) After Its First-Quarter Results

37 Interactive Entertainment Network Technology Group Co., Ltd. (SZSE:002555) last week reported its latest quarterly results, which makes it a good time for investors to dive in and see if the business is performing in line with expectations. It was a credible result overall, with revenues of CN¥4.8b and statutory earnings per share of CN¥0.28 both in line with analyst estimates, showing that 37 Interactive Entertainment Network Technology Group is executing in line with expectations. 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. So we collected the latest post-earnings statutory consensus estimates to see what could be in store for next year.

View our latest analysis for 37 Interactive Entertainment Network Technology Group

Taking into account the latest results, the consensus forecast from 37 Interactive Entertainment Network Technology Group's 18 analysts is for revenues of CN¥19.2b in 2024. This reflects a meaningful 9.6% improvement in revenue compared to the last 12 months. Per-share earnings are expected to soar 28% to CN¥1.46. Before this earnings report, the analysts had been forecasting revenues of CN¥19.5b and earnings per share (EPS) of CN¥1.40 in 2024. So the consensus seems to have become somewhat more optimistic on 37 Interactive Entertainment Network Technology Group's earnings potential following these results.

There's been no major changes to the consensus price target of CN¥25.16, 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. There are some variant perceptions on 37 Interactive Entertainment Network Technology Group, with the most bullish analyst valuing it at CN¥33.00 and the most bearish at CN¥19.40 per share. 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 37 Interactive Entertainment Network Technology 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. The analysts are definitely expecting 37 Interactive Entertainment Network Technology Group's growth to accelerate, with the forecast 13% annualised growth to the end of 2024 ranking favourably alongside historical growth of 8.2% per annum over the past five years. Compare this with other companies in the same industry, which are forecast to see revenue growth of 17% annually. So it's clear that despite the acceleration in growth, 37 Interactive Entertainment Network Technology Group is expected to grow meaningfully slower than the industry average.

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 37 Interactive Entertainment Network Technology Group following these results. Fortunately, the analysts also reconfirmed their revenue estimates, suggesting that it's tracking in line with expectations. Although our data does suggest that 37 Interactive Entertainment Network Technology Group's revenue is expected to perform worse 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.

With that in mind, we wouldn't be too quick to come to a conclusion on 37 Interactive Entertainment Network Technology Group. Long-term earnings power is much more important than next year's profits. We have forecasts for 37 Interactive Entertainment Network Technology Group going out to 2026, and you can see them free on our platform here.

However, before you get too enthused, we've discovered 1 warning sign for 37 Interactive Entertainment Network Technology Group that you should be aware of.

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.