Regina Miracle International (Holdings) Limited (HKG:2199) Just Reported And Analysts Have Been Lifting Their Price Targets

It's been a good week for Regina Miracle International (Holdings) Limited (HKG:2199) shareholders, because the company has just released its latest annual results, and the shares gained 4.8% to HK$2.84. Regina Miracle International (Holdings) reported HK$6.0b in revenue, roughly in line with analyst forecasts, although statutory earnings per share (EPS) of HK$0.10 beat expectations, being 3.2% higher than what the analysts expected. 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. With this in mind, we've gathered the latest statutory forecasts to see what the analysts are expecting for next year.

See our latest analysis for Regina Miracle International (Holdings)

After the latest results, the four analysts covering Regina Miracle International (Holdings) are now predicting revenues of HK$7.00b in 2022. If met, this would reflect a meaningful 17% improvement in sales compared to the last 12 months. Per-share earnings are expected to bounce 146% to HK$0.25. Before this earnings report, the analysts had been forecasting revenues of HK$7.00b and earnings per share (EPS) of HK$0.25 in 2022. The consensus analysts don't seem to have seen anything in these results that would have changed their view on the business, given there's been no major change to their estimates.

With the analysts reconfirming their revenue and earnings forecasts, it's surprising to see that the price target rose 8.9% to HK$3.51. It looks as though they previously had some doubts over whether the business would live up to their expectations. 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 Regina Miracle International (Holdings) analyst has a price target of HK$4.00 per share, while the most pessimistic values it at HK$2.70. 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. It's clear from the latest estimates that Regina Miracle International (Holdings)'s rate of growth is expected to accelerate meaningfully, with the forecast 17% annualised revenue growth to the end of 2022 noticeably faster than its historical growth of 5.3% p.a. over the past five years. Compare this with other companies in the same industry, which are forecast to grow their revenue 15% annually. Regina Miracle International (Holdings) 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 obvious conclusion is that there's been no major change in the business' prospects in recent times, with the analysts holding their earnings forecasts steady, in line with previous estimates. Happily, there were no real changes to sales forecasts, with the business still expected to grow in line with the overall industry. We note an upgrade to the price target, suggesting that the analysts believes the intrinsic value of the business is likely to improve over time.

With that in mind, we wouldn't be too quick to come to a conclusion on Regina Miracle International (Holdings). 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 Regina Miracle International (Holdings) going out to 2023, and you can see them free on our platform here..

And what about risks? Every company has them, and we've spotted 2 warning signs for Regina Miracle International (Holdings) (of which 1 is a bit concerning!) you should know about.

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This article by Simply Wall St is general in nature. 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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