Industry Analysts Just Made A Meaningful Upgrade To Their AviChina Industry & Technology Company Limited (HKG:2357) Revenue Forecasts

AviChina Industry & Technology Company Limited (HKG:2357) shareholders will have a reason to smile today, with the analysts making substantial upgrades to this year's statutory forecasts. The analysts have sharply increased their revenue numbers, with a view that AviChina Industry & Technology will make substantially more sales than they'd previously expected.

After the upgrade, the six analysts covering AviChina Industry & Technology are now predicting revenues of CN¥102b in 2024. If met, this would reflect a meaningful 20% improvement in sales compared to the last 12 months. Statutory earnings per share are presumed to soar 21% to CN¥0.37. Before this latest update, the analysts had been forecasting revenues of CN¥90b and earnings per share (EPS) of CN¥0.37 in 2024. It seems analyst sentiment has certainly become more bullish on revenues, even though they haven't changed their view on earnings per share.

See our latest analysis for AviChina Industry & Technology

Even though revenue forecasts increased, there was no change to the consensus price target of CN¥5.99, suggesting the analysts are focused on earnings as the driver of value creation. Fixating on a single price target can be unwise though, since the consensus target is effectively the average of analyst price targets. As a result, some investors like to look at the range of estimates to see if there are any diverging opinions on the company's valuation. The most optimistic AviChina Industry & Technology analyst has a price target of CN¥7.19 per share, while the most pessimistic values it at CN¥5.21. Analysts definitely have varying views on the business, but the spread of estimates is not wide enough in our view to suggest that extreme outcomes could await AviChina Industry & Technology shareholders.

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the AviChina Industry & Technology's past performance and to peers in the same industry. The analysts are definitely expecting AviChina Industry & Technology's growth to accelerate, with the forecast 20% annualised growth to the end of 2024 ranking favourably alongside historical growth of 15% per annum over the past five years. Compare this with other companies in the same industry, which are forecast to grow their revenue 17% annually. AviChina Industry & Technology is expected to grow at about the same rate as its industry, so it's not clear that we can draw any conclusions from its growth relative to competitors.

The Bottom Line

The most important thing to take away is that there's been no major change in sentiment, with analysts reconfirming that earnings per share are expected to continue performing in line with their prior expectations. There was also an upgrade to revenue estimates, although as we saw earlier, forecast growth is only expected to be about the same as the wider market. Seeing the dramatic upgrade to this year's forecasts, it might be time to take another look at AviChina Industry & Technology.

Still, the long-term prospects of the business are much more relevant than next year's earnings. At Simply Wall St, we have a full range of analyst estimates for AviChina Industry & Technology going out to 2026, and you can see them 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 that insiders are buying.

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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.