New Forecasts: Here's What Analysts Think The Future Holds For EC Healthcare (HKG:2138)

Shareholders in EC Healthcare (HKG:2138) may be thrilled to learn that the analysts have just delivered a major upgrade to their near-term forecasts. The consensus statutory numbers for both revenue and earnings per share (EPS) increased, with their view clearly much more bullish on the company's business prospects.

After this upgrade, EC Healthcare's dual analysts are now forecasting revenues of HK$2.9b in 2022. This would be a major 38% improvement in sales compared to the last 12 months. Statutory earnings per share are presumed to jump 74% to HK$0.33. Prior to this update, the analysts had been forecasting revenues of HK$2.5b and earnings per share (EPS) of HK$0.29 in 2022. So we can see there's been a pretty clear increase in analyst sentiment in recent times, with both revenues and earnings per share receiving a decent lift in the latest estimates.

See our latest analysis for EC Healthcare

With these upgrades, we're not surprised to see that the analysts have lifted their price target 38% to HK$16.10 per share. There's another way to think about price targets though, and that's to look at the range of price targets put forward by analysts, because a wide range of estimates could suggest a diverse view on possible outcomes for the business. The most optimistic EC Healthcare analyst has a price target of HK$15.00 per share, while the most pessimistic values it at HK$8.30. There are definitely some different views on the stock, but the range of estimates is not wide enough as to imply that the situation is unforecastable, in our view.

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 clear from the latest estimates that EC Healthcare's rate of growth is expected to accelerate meaningfully, with the forecast 38% annualised revenue growth to the end of 2022 noticeably faster than its historical growth of 19% p.a. 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 18% per year. It seems obvious that, while the growth outlook is brighter than the recent past, the analysts also expect EC Healthcare to grow faster than the wider industry.

The Bottom Line

The biggest takeaway for us from these new estimates is that analysts upgraded their earnings per share estimates, with improved earnings power expected for this year. They also upgraded their revenue estimates for this year, and sales are expected to grow faster than the wider market. With a serious upgrade to expectations and a rising price target, it might be time to take another look at EC Healthcare.

Even so, the longer term trajectory of the business is much more important for the value creation of shareholders. We have analyst estimates for EC Healthcare going out as far as 2023, and you can see them free on our platform here.

Of course, seeing company management invest large sums of money in a stock can be just as useful as knowing whether analysts are upgrading their estimates. So you may also wish to search this free list of stocks that insiders are buying.

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