Angelalign Technology Inc. Just Beat Earnings Expectations: Here's What Analysts Think Will Happen Next

Angelalign Technology Inc. (HKG:6699) just released its latest full-year results and things are looking bullish. Results were good overall, with revenues beating analyst predictions by 3.6% to hit CN¥1.3b. Statutory earnings per share (EPS) came in at CN¥1.29, some 7.0% above whatthe analysts had expected. The analysts typically update their forecasts at each earnings report, and we can judge from their estimates whether their view of the company has changed or if there are any new concerns to be aware of. We thought readers would find it interesting to see the analysts latest (statutory) post-earnings forecasts for next year.

See our latest analysis for Angelalign Technology

Following the latest results, Angelalign Technology's twelve analysts are now forecasting revenues of CN¥1.47b in 2023. This would be a decent 16% improvement in sales compared to the last 12 months. Statutory earnings per share are predicted to step up 16% to CN¥1.47. Yet prior to the latest earnings, the analysts had been anticipated revenues of CN¥1.50b and earnings per share (EPS) of CN¥1.57 in 2023. It's pretty clear that pessimism has reared its head after the latest results, leading to a weaker revenue outlook and a small dip in earnings per share estimates.

The analysts made no major changes to their price target of HK$133, suggesting the downgrades are not expected to have a long-term impact on Angelalign Technology's valuation. 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 Angelalign Technology analyst has a price target of HK$178 per share, while the most pessimistic values it at HK$91.12. 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 pretty clear that there is an expectation that Angelalign Technology's revenue growth will slow down substantially, with revenues to the end of 2023 expected to display 16% growth on an annualised basis. This is compared to a historical growth rate of 21% over the past three years. Compare this against other companies (with analyst forecasts) in the industry, which are in aggregate expected to see revenue growth of 32% annually. Factoring in the forecast slowdown in growth, it seems obvious that Angelalign Technology is also expected to grow slower than other industry participants.

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. On the negative side, they also downgraded their revenue estimates, and forecasts imply revenues will perform worse than the wider industry. The consensus price target held steady at HK$133, with the latest estimates not enough to have an impact on their price targets.

With that said, the long-term trajectory of the company's earnings is a lot more important than next year. We have estimates - from multiple Angelalign Technology analysts - going out to 2025, and you can see them free on our platform here.

Another thing to consider is whether management and directors have been buying or selling stock recently. We provide an overview of all open market stock trades for the last twelve months on our platform, here.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

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.