Results: Universal Scientific Industrial (Shanghai) Co., Ltd. Exceeded Expectations And The Consensus Has Updated Its Estimates

Universal Scientific Industrial (Shanghai) Co., Ltd. (SHSE:601231) defied analyst predictions to release its quarterly results, which were ahead of market expectations. The company beat forecasts, with revenue of CN¥14b, some 2.2% above estimates, and statutory earnings per share (EPS) coming in at CN¥0.21, 28% ahead of 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. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether the analysts have changed their mind on Universal Scientific Industrial (Shanghai) after the latest results.

Check out our latest analysis for Universal Scientific Industrial (Shanghai)

Taking into account the latest results, the consensus forecast from Universal Scientific Industrial (Shanghai)'s seven analysts is for revenues of CN¥64.3b in 2024. This reflects an okay 4.8% improvement in revenue compared to the last 12 months. Statutory earnings per share are predicted to swell 13% to CN¥1.01. Before this earnings report, the analysts had been forecasting revenues of CN¥65.6b and earnings per share (EPS) of CN¥1.00 in 2024. So it looks like the analysts have become a bit less optimistic after the latest results announcement, with revenues expected to fall even as the company is supposed to maintain EPS.

The average price target was steady at CN¥18.35even though revenue estimates declined; likely suggesting the analysts place a higher value on earnings. The consensus price target is just an average of individual analyst targets, so - it could be handy to see how wide the range of underlying estimates is. Currently, the most bullish analyst values Universal Scientific Industrial (Shanghai) at CN¥20.00 per share, while the most bearish prices it at CN¥17.00. With such a narrow range of valuations, the analysts apparently share similar views on what they think the business is worth.

One way to get more context on these forecasts is to look at how they compare to both past performance, and how other companies in the same industry are performing. We would highlight that Universal Scientific Industrial (Shanghai)'s revenue growth is expected to slow, with the forecast 9.9% annualised growth rate until the end of 2024 being well below the historical 12% p.a. growth over the last five years. By way of comparison, the other companies in this industry with analyst coverage are forecast to grow their revenue at 17% per year. So it's pretty clear that, while revenue growth is expected to slow down, the wider industry is also expected to grow faster than Universal Scientific Industrial (Shanghai).

The Bottom Line

The most important thing to take away is that there's been no major change in sentiment, with the analysts reconfirming that the business is performing in line with their previous earnings per share estimates. Unfortunately, they also downgraded their revenue estimates, and our data indicates underperformance compared to the wider industry. Even so, earnings per share are more important to the intrinsic value of the business. Yet - earnings are more important to the intrinsic value of the business. The consensus price target held steady at CN¥18.35, 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. We have estimates - from multiple Universal Scientific Industrial (Shanghai) analysts - going out to 2026, and you can see them free on our platform here.

And what about risks? Every company has them, and we've spotted 1 warning sign for Universal Scientific Industrial (Shanghai) you should know about.

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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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com