Here's What Analysts Are Forecasting For Milkyway Chemical Supply Chain Service Co.,Ltd (SHSE:603713) After Its Second-Quarter Results

Shareholders might have noticed that Milkyway Chemical Supply Chain Service Co.,Ltd (SHSE:603713) filed its second-quarter result this time last week. The early response was not positive, with shares down 3.5% to CN¥49.17 in the past week. Results overall were respectable, with statutory earnings of CN¥2.54 per share roughly in line with what the analysts had forecast. Revenues of CN¥3.1b came in 3.2% ahead of analyst predictions. 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. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether the analysts have changed their mind on Milkyway Chemical Supply Chain ServiceLtd after the latest results.

Check out our latest analysis for Milkyway Chemical Supply Chain ServiceLtd

Following the latest results, Milkyway Chemical Supply Chain ServiceLtd's seven analysts are now forecasting revenues of CN¥11.9b in 2024. This would be a modest 5.8% improvement in revenue compared to the last 12 months. Statutory earnings per share are predicted to grow 15% to CN¥3.46. In the lead-up to this report, the analysts had been modelling revenues of CN¥11.6b and earnings per share (EPS) of CN¥3.38 in 2024. The analysts seems to have become more bullish on the business, judging by their new earnings per share estimates.

The consensus price target was unchanged at CN¥73.14, implying that the improved earnings outlook is not expected to have a long term impact on value creation for shareholders. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. Currently, the most bullish analyst values Milkyway Chemical Supply Chain ServiceLtd at CN¥82.00 per share, while the most bearish prices it at CN¥64.20. Even so, with a relatively close grouping of estimates, it looks like the analysts are quite confident in their valuations, suggesting Milkyway Chemical Supply Chain ServiceLtd is an easy business to forecast or the the analysts are all using similar assumptions.

Taking a look at the bigger picture now, one of the ways we can understand these forecasts is to see how they compare to both past performance and industry growth estimates. It's pretty clear that there is an expectation that Milkyway Chemical Supply Chain ServiceLtd's revenue growth will slow down substantially, with revenues to the end of 2024 expected to display 12% growth on an annualised basis. This is compared to a historical growth rate of 31% over the past five years. Compare this to the 29 other companies in this industry with analyst coverage, which are forecast to grow their revenue at 11% per year. So it's pretty clear that, while Milkyway Chemical Supply Chain ServiceLtd's revenue growth is expected to slow, it's expected to grow roughly in line with the industry.

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 Milkyway Chemical Supply Chain ServiceLtd following these results. Happily, there were no real changes to revenue forecasts, with the business still expected to grow in line with the overall industry. The consensus price target held steady at CN¥73.14, 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 Milkyway Chemical Supply Chain ServiceLtd analysts - going out to 2026, and you can see them free on our platform here.

Even so, be aware that Milkyway Chemical Supply Chain ServiceLtd is showing 2 warning signs in our investment analysis , and 1 of those is concerning...

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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.

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