Results: Will Semiconductor Co., Ltd. Exceeded Expectations And The Consensus Has Updated Its Estimates

Will Semiconductor Co., Ltd. (SHSE:603501) came out with its second-quarter results last week, and we wanted to see how the business is performing and what industry forecasters think of the company following this report. Revenues were CN¥6.4b, approximately in line with expectations, although statutory earnings per share (EPS) performed substantially better. EPS of CN¥0.68 were also better than expected, beating analyst predictions by 13%. This is an important time for investors, as they can track a company's performance in its report, look at what experts are forecasting for next year, and see if there has been any change to expectations for the business. So we collected the latest post-earnings statutory consensus estimates to see what could be in store for next year.

Check out our latest analysis for Will Semiconductor

Taking into account the latest results, the current consensus from Will Semiconductor's 24 analysts is for revenues of CN¥26.6b in 2024. This would reflect a solid 9.8% increase on its revenue over the past 12 months. Per-share earnings are expected to jump 79% to CN¥2.64. Yet prior to the latest earnings, the analysts had been anticipated revenues of CN¥26.6b and earnings per share (EPS) of CN¥2.57 in 2024. So the consensus seems to have become somewhat more optimistic on Will Semiconductor's earnings potential following these results.

There's been no major changes to the consensus price target of CN¥126, 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. Currently, the most bullish analyst values Will Semiconductor at CN¥162 per share, while the most bearish prices it at CN¥77.00. This is a fairly broad spread of estimates, suggesting that analysts are forecasting a wide range of possible outcomes for the 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 clear from the latest estimates that Will Semiconductor's rate of growth is expected to accelerate meaningfully, with the forecast 21% annualised revenue growth to the end of 2024 noticeably faster than its historical growth of 8.3% p.a. over the past five years. Other similar companies in the industry (with analyst coverage) are also forecast to grow their revenue at 22% per year. Will Semiconductor is expected to grow at about the same rate as its industry, so it's not clear that we can draw any conclusions from its growth relative to competitors.

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 Will Semiconductor following these results. They also reconfirmed their revenue estimates, with the company predicted to grow at about the same rate as the wider industry. The consensus price target held steady at CN¥126, with the latest estimates not enough to have an impact on their price targets.

Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. At Simply Wall St, we have a full range of analyst estimates for Will Semiconductor going out to 2026, and you can see them free on our platform here..

It might also be worth considering whether Will Semiconductor's debt load is appropriate, using our debt analysis tools on the Simply Wall St 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.