Party Time: Brokers Just Made Major Increases To Their Zhaojin Mining Industry Company Limited (HKG:1818) Earnings Forecasts

Zhaojin Mining Industry Company Limited (HKG:1818) shareholders will have a reason to smile today, with the analysts making substantial upgrades to this year's statutory forecasts. Consensus estimates suggest investors could expect greatly increased statutory revenues and earnings per share, with the analysts modelling a real improvement in business performance.

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After the upgrade, the twelve analysts covering Zhaojin Mining Industry are now predicting revenues of CN¥15b in 2025. If met, this would reflect a solid 19% improvement in sales compared to the last 12 months. Per-share earnings are expected to bounce 88% to CN¥0.89. Before this latest update, the analysts had been forecasting revenues of CN¥12b and earnings per share (EPS) of CN¥0.62 in 2025. There has definitely been an improvement in perception recently, with the analysts substantially increasing both their earnings and revenue estimates.

See our latest analysis for Zhaojin Mining Industry

With these upgrades, we're not surprised to see that the analysts have lifted their price target 24% to CN¥20.45 per share. 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. There are some variant perceptions on Zhaojin Mining Industry, with the most bullish analyst valuing it at CN¥25.45 and the most bearish at CN¥14.59 per share. These price targets show that analysts do have some differing views on the business, but the estimates do not vary enough to suggest to us that some are betting on wild success or utter failure.

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. The analysts are definitely expecting Zhaojin Mining Industry's growth to accelerate, with the forecast 26% annualised growth to the end of 2025 ranking favourably alongside historical growth of 10% per annum 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 5.7% per year. Factoring in the forecast acceleration in revenue, it's pretty clear that Zhaojin Mining Industry is expected to grow much faster than its 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. Fortunately, analysts also upgraded their revenue estimates, and our data indicates sales are expected to perform better than the wider market. With a serious upgrade to expectations and a rising price target, it might be time to take another look at Zhaojin Mining Industry.

Better yet, our automated discounted cash flow calculation (DCF) suggests Zhaojin Mining Industry could be moderately undervalued. You can learn more about our valuation methodology on our platform here.

Another way to search for interesting companies that could be reaching an inflection point is to track whether management are buying or selling, with our free list of growing companies backed by insiders.

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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.