Helens International Holdings Company Limited (HKG:9869) Consensus Forecasts Have Become A Little Darker Since Its Latest Report

Investors in Helens International Holdings Company Limited (HKG:9869) had a good week, as its shares rose 4.5% to close at HK$14.72 following the release of its yearly results. Revenues were in line with expectations, at CN¥1.8b, while statutory losses ballooned to CN¥0.21 per share. 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. 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 Helens International Holdings

Taking into account the latest results, the most recent consensus for Helens International Holdings from ten analysts is for revenues of CN¥3.99b in 2022 which, if met, would be a substantial 117% increase on its sales over the past 12 months. Helens International Holdings is also expected to turn profitable, with statutory earnings of CN¥0.32 per share. Yet prior to the latest earnings, the analysts had been anticipated revenues of CN¥4.67b and earnings per share (EPS) of CN¥0.39 in 2022. Indeed, we can see that the analysts are a lot more bearish about Helens International Holdings' prospects following the latest results, administering a substantial drop in revenue estimates and slashing their EPS estimates to boot.

It'll come as no surprise then, to learn that the analysts have cut their price target 5.2% to HK$22.38. That's not the only conclusion we can draw from this data however, as some investors also like to consider the spread in estimates when evaluating analyst price targets. There are some variant perceptions on Helens International Holdings, with the most bullish analyst valuing it at HK$27.16 and the most bearish at HK$16.90 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 Helens International Holdings shareholders.

Looking at the bigger picture now, one of the ways we can make sense of these forecasts is to see how they measure up against both past performance and industry growth estimates. The analysts are definitely expecting Helens International Holdings' growth to accelerate, with the forecast 117% annualised growth to the end of 2022 ranking favourably alongside historical growth of 55% per annum over the past three years. Compare this with other companies in the same industry, which are forecast to grow their revenue 26% annually. Factoring in the forecast acceleration in revenue, it's pretty clear that Helens International Holdings is expected to grow much faster than its industry.

The Bottom Line

The most important thing to take away is that the analysts downgraded their earnings per share estimates, showing that there has been a clear decline in sentiment following these results. Regrettably, they also downgraded their revenue estimates, but the latest forecasts still imply the business will grow faster than the wider industry. Furthermore, the analysts also cut their price targets, suggesting that the latest news has led to greater pessimism about the intrinsic value of the business.

Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. We have forecasts for Helens International Holdings going out to 2024, and you can see them free on our platform here.

Before you take the next step you should know about the 2 warning signs for Helens International Holdings that we have uncovered.

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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.