Analysts Just Shipped A Substantial Upgrade To Their Eoptolink Technology Inc., Ltd. (SZSE:300502) Estimates

Eoptolink Technology Inc., Ltd. (SZSE:300502) shareholders will have a reason to smile today, with the analysts making substantial upgrades to this year's statutory forecasts. The consensus statutory numbers for both revenue and earnings per share (EPS) increased, with their view clearly much more bullish on the company's business prospects.

Following the upgrade, the most recent consensus for Eoptolink Technology from its eleven analysts is for revenues of CN¥7.1b in 2024 which, if met, would be a sizeable 57% increase on its sales over the past 12 months. Statutory earnings per share are presumed to jump 63% to CN¥2.92. Prior to this update, the analysts had been forecasting revenues of CN¥6.1b and earnings per share (EPS) of CN¥2.13 in 2024. So we can see there's been a pretty clear increase in analyst sentiment in recent times, with both revenues and earnings per share receiving a decent lift in the latest estimates.

Check out our latest analysis for Eoptolink Technology

Despite these upgrades, the analysts have not made any major changes to their price target of CN¥114, suggesting that the higher estimates are not likely to have a long term impact on what the stock is worth.

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. The analysts are definitely expecting Eoptolink Technology's growth to accelerate, with the forecast 147% annualised growth to the end of 2024 ranking favourably alongside historical growth of 23% per annum over the past five years. Compare this with other companies in the same industry, which are forecast to grow their revenue 18% annually. It seems obvious that, while the growth outlook is brighter than the recent past, the analysts also expect Eoptolink Technology to grow faster than the wider industry.

The Bottom Line

The most important thing to take away from this upgrade is that analysts upgraded their earnings per share estimates for this year, expecting improving business conditions. Fortunately, analysts also upgraded their revenue estimates, and our data indicates sales are expected to perform better 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 Eoptolink Technology.

These earnings upgrades look like a sterling endorsement, but before diving in - you should know that we've spotted 2 potential warning sign with Eoptolink Technology, including concerns around earnings quality. You can learn more, and discover the 1 other warning sign we've identified, for free on our platform here.

Another way to search for interesting companies that could be reaching an inflection point is to track whether management are buying or selling, with our free list of growing companies backed by insiders.

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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.