Zhuzhou CRRC Times Electric Co., Ltd. Just Beat Revenue By 16%: Here's What Analysts Think Will Happen Next

A week ago, Zhuzhou CRRC Times Electric Co., Ltd. (HKG:3898) came out with a strong set of first-quarter numbers that could potentially lead to a re-rate of the stock. It was a decent earnings report, with revenues and statutory earnings per share (EPS) both performing well. Revenues were 16% higher than the analysts had forecast, at CN¥3.9b, while EPS of CN¥0.40 beat analyst models by 10%. The analysts typically update their forecasts at each earnings report, and we can judge from their estimates whether their view of the company has changed or if there are any new concerns to be aware of. We've gathered the most recent statutory forecasts to see whether the analysts have changed their earnings models, following these results.

See our latest analysis for Zhuzhou CRRC Times Electric

Taking into account the latest results, the most recent consensus for Zhuzhou CRRC Times Electric from 21 analysts is for revenues of CN¥25.9b in 2024. If met, it would imply a meaningful 14% increase on its revenue over the past 12 months. Per-share earnings are expected to expand 12% to CN¥2.56. Before this earnings report, the analysts had been forecasting revenues of CN¥25.5b and earnings per share (EPS) of CN¥2.45 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 HK$36.58, implying that the improved earnings outlook is not expected to have a long term impact on value creation for shareholders. 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 Zhuzhou CRRC Times Electric at HK$46.94 per share, while the most bearish prices it at HK$26.83. This shows there is still a bit of diversity in estimates, but analysts don't appear to be totally split on the stock as though it might be a success or failure situation.

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. The analysts are definitely expecting Zhuzhou CRRC Times Electric's growth to accelerate, with the forecast 19% annualised growth to the end of 2024 ranking favourably alongside historical growth of 6.8% per annum over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to grow their revenue at 10% per year. It seems obvious that, while the growth outlook is brighter than the recent past, the analysts also expect Zhuzhou CRRC Times Electric to grow faster than the wider 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 Zhuzhou CRRC Times Electric following these results. Happily, there were no major changes to revenue forecasts, with the business still expected to grow faster than the wider industry. There was no real change to the consensus price target, suggesting that the intrinsic value of the business has not undergone any major changes with the latest estimates.

With that in mind, we wouldn't be too quick to come to a conclusion on Zhuzhou CRRC Times Electric. Long-term earnings power is much more important than next year's profits. At Simply Wall St, we have a full range of analyst estimates for Zhuzhou CRRC Times Electric going out to 2026, and you can see them free on our platform here..

Another thing to consider is whether management and directors have been buying or selling stock recently. We provide an overview of all open market stock trades for the last twelve months on our platform, here.

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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.