Analysts Just Published A Bright New Outlook For China Resources Medical Holdings Company Limited's (HKG:1515)

Celebrations may be in order for China Resources Medical Holdings Company Limited (HKG:1515) shareholders, with the analysts delivering a significant upgrade to their statutory estimates for the company. 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.

Following the upgrade, the most recent consensus for China Resources Medical Holdings from its four analysts is for revenues of CN¥8.9b in 2023 which, if met, would be a major 58% increase on its sales over the past 12 months. Per-share earnings are expected to jump 414% to CN¥0.55. Before this latest update, the analysts had been forecasting revenues of CN¥6.4b and earnings per share (EPS) of CN¥0.42 in 2023. 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.

Check out our latest analysis for China Resources Medical Holdings

With these upgrades, we're not surprised to see that the analysts have lifted their price target 6.3% to CN¥7.43 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. Currently, the most bullish analyst values China Resources Medical Holdings at CN¥12.33 per share, while the most bearish prices it at CN¥5.62. Note the wide gap in analyst price targets? This implies to us that there is a fairly broad range of possible scenarios for the underlying business.

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 China Resources Medical Holdings' rate of growth is expected to accelerate meaningfully, with the forecast 58% annualised revenue growth to the end of 2023 noticeably faster than its historical growth of 26% p.a. over the past five years. Compare this with other companies in the same industry, which are forecast to grow their revenue 13% annually. Factoring in the forecast acceleration in revenue, it's pretty clear that China Resources Medical Holdings is expected to grow much faster than its industry.

The Bottom Line

The most important thing to take away from this upgrade is that analysts upgraded their earnings per share estimates for this year, expecting improving business conditions. They also upgraded their revenue estimates for this year, and sales are expected to grow faster than the wider market. Given that the consensus looks almost universally bullish, with a substantial increase to forecasts and a higher price target, China Resources Medical Holdings could be worth investigating further.

Still, the long-term prospects of the business are much more relevant than next year's earnings. At Simply Wall St, we have a full range of analyst estimates for China Resources Medical Holdings going out to 2025, 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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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.