CN¥42.18: That's What Analysts Think Qingdao Gaoce Technology Co., Ltd (SHSE:688556) Is Worth After Its Latest Results

Investors in Qingdao Gaoce Technology Co., Ltd (SHSE:688556) had a good week, as its shares rose 2.9% to close at CN¥31.07 following the release of its full-year results. It was a credible result overall, with revenues of CN¥6.2b and statutory earnings per share of CN¥4.37 both in line with analyst estimates, showing that Qingdao Gaoce Technology is executing in line with expectations. 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.

Check out our latest analysis for Qingdao Gaoce Technology

After the latest results, the ten analysts covering Qingdao Gaoce Technology are now predicting revenues of CN¥6.93b in 2024. If met, this would reflect a solid 12% improvement in revenue compared to the last 12 months. Statutory earnings per share are expected to descend 19% to CN¥3.47 in the same period. In the lead-up to this report, the analysts had been modelling revenues of CN¥6.32b and earnings per share (EPS) of CN¥3.52 in 2024. So it looks like there's been no major change in sentiment following the latest results, although the analysts have made a modest lift to to revenue forecasts.

Even though revenue forecasts increased, the consensus price target 7.1% to CN¥42.18, perhaps suggesting thatthe analysts have become more pessimistic about the lack of earnings growth. There's another way to think about price targets though, and that's to look at the range of price targets put forward by analysts, because a wide range of estimates could suggest a diverse view on possible outcomes for the business. The most optimistic Qingdao Gaoce Technology analyst has a price target of CN¥66.00 per share, while the most pessimistic values it at CN¥30.00. This is a fairly broad spread of estimates, suggesting that analysts are forecasting a wide range of possible outcomes for the business.

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Qingdao Gaoce Technology's past performance and to peers in the same industry. We would highlight that Qingdao Gaoce Technology's revenue growth is expected to slow, with the forecast 12% annualised growth rate until the end of 2024 being well below the historical 52% p.a. growth over the last five years. Compare this against other companies (with analyst forecasts) in the industry, which are in aggregate expected to see revenue growth of 23% annually. So it's pretty clear that, while revenue growth is expected to slow down, the wider industry is also expected to grow faster than Qingdao Gaoce Technology.

The Bottom Line

The most obvious conclusion is that there's been no major change in the business' prospects in recent times, with the analysts holding their earnings forecasts steady, in line with previous estimates. They also upgraded their revenue estimates for next year, even though it is expected to grow slower than the wider industry. Furthermore, the analysts also cut their price targets, suggesting that the latest news has led to greater pessimism about the intrinsic value of the business.

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. We have forecasts for Qingdao Gaoce Technology going out to 2026, and you can see them free on our platform here.

Plus, you should also learn about the 3 warning signs we've spotted with Qingdao Gaoce Technology (including 1 which doesn't sit too well with us) .

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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.