Growth Investors: Industry Analysts Just Upgraded Their Fosun Tourism Group (HKG:1992) Revenue Forecasts By 13%

Fosun Tourism Group (HKG:1992) shareholders will have a reason to smile today, with the analysts making substantial upgrades to this year's statutory forecasts. The revenue forecast for this year has experienced a facelift, with the analysts now much more optimistic on its sales pipeline. Investor sentiment seems to be improving too, with the share price up 9.5% to HK$13.12 over the past 7 days. It will be interesting to see if this latest upgrade is enough to kickstart further buying interest in the stock.

After this upgrade, Fosun Tourism Group's five analysts are now forecasting revenues of CN¥12b in 2021. This would be a major 76% improvement in sales compared to the last 12 months. Before the latest update, the analysts were foreseeing CN¥11b of revenue in 2021. It looks like there's been a clear increase in optimism around Fosun Tourism Group, given the nice increase in revenue forecasts.

See our latest analysis for Fosun Tourism Group

There was no particular change to the consensus price target of CN¥11.30, with Fosun Tourism Group's latest outlook seemingly not enough to result in a change of valuation. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. There are some variant perceptions on Fosun Tourism Group, with the most bullish analyst valuing it at CN¥15.61 and the most bearish at CN¥11.50 per share. 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 Fosun Tourism Group shareholders.

Of course, another way to look at these forecasts is to place them into context against the industry itself. It's clear from the latest estimates that Fosun Tourism Group's rate of growth is expected to accelerate meaningfully, with the forecast 76% annualised revenue growth to the end of 2021 noticeably faster than its historical growth of 3.3% p.a. over the past five years. Compare this with other companies in the same industry, which are forecast to grow their revenue 32% annually. It seems obvious that, while the growth outlook is brighter than the recent past, the analysts also expect Fosun Tourism Group to grow faster than the wider industry.

The Bottom Line

The highlight for us was that analysts increased their revenue forecasts for Fosun Tourism Group this year. They're also forecasting more rapid revenue growth than the wider market. Given that analysts appear to be expecting substantial improvement in the sales pipeline, now could be the right time to take another look at Fosun Tourism Group.

It's great to see the analysts upgrading their estimates, but the biggest highlight to us is that the business is expected to become profitable in the foreseeable future. For more information, you can click through to our free platform to learn more about these forecasts.

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