Need To Know: Analysts Are Much More Bullish On VeriSilicon Microelectronics (Shanghai) Co., Ltd. (SHSE:688521)

Celebrations may be in order for VeriSilicon Microelectronics (Shanghai) Co., Ltd. (SHSE:688521) shareholders, with the analysts delivering a significant upgrade to their statutory estimates for the company. Consensus estimates suggest investors could expect greatly increased statutory revenues and earnings per share, with analysts modelling a real improvement in business performance.

After this upgrade, VeriSilicon Microelectronics (Shanghai)'s eight analysts are now forecasting revenues of CN¥3.0b in 2024. This would be a major 40% improvement in sales compared to the last 12 months. The loss per share is anticipated to greatly reduce in the near future, narrowing 100% to CN¥0.0015. However, before this estimates update, the consensus had been expecting revenues of CN¥2.6b and CN¥0.073 per share in losses. So there's been quite a change-up of views after the recent consensus updates, with the analysts making a sizeable increase to their revenue forecasts while also reducing the estimated loss as the business grows towards breakeven.

Check out our latest analysis for VeriSilicon Microelectronics (Shanghai)

There was no major change to the consensus price target of CN¥45.50, perhaps suggesting that the analysts remain concerned about ongoing losses despite the improved earnings and revenue outlook.

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the VeriSilicon Microelectronics (Shanghai)'s past performance and to peers in the same industry. It's clear from the latest estimates that VeriSilicon Microelectronics (Shanghai)'s rate of growth is expected to accelerate meaningfully, with the forecast 96% annualised revenue growth to the end of 2024 noticeably faster than its historical growth of 11% p.a. over the past three years. Compare this with other companies in the same industry, which are forecast to grow their revenue 22% annually. Factoring in the forecast acceleration in revenue, it's pretty clear that VeriSilicon Microelectronics (Shanghai) is expected to grow much faster than its industry.

The Bottom Line

The most important thing here is that analysts reduced their loss per share estimates for this year, reflecting increased optimism around VeriSilicon Microelectronics (Shanghai)'s prospects. They also upgraded their revenue estimates for this year, and sales are expected to grow faster than the wider market. The lack of change in the price target is puzzling, but with a serious upgrade to this year's earnings expectations, it might be time to take another look at VeriSilicon Microelectronics (Shanghai).

Better yet, VeriSilicon Microelectronics (Shanghai) is expected to break-even soon - within the next few years - according to analyst forecasts, which would be a momentous event for shareholders. You can learn more about these forecasts, for free 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.