Kuaishou Technology (HKG:1024) Just Reported And Analysts Have Been Lifting Their Price Targets

It's been a good week for Kuaishou Technology (HKG:1024) shareholders, because the company has just released its latest second-quarter results, and the shares gained 6.9% to HK$78.75. Kuaishou Technology reported CN¥35b in revenue, roughly in line with analyst forecasts, although statutory earnings per share (EPS) of CN¥1.13 beat expectations, being 4.2% higher than what the analysts expected. 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. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether the analysts have changed their mind on Kuaishou Technology after the latest results.

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Taking into account the latest results, the consensus forecast from Kuaishou Technology's 33 analysts is for revenues of CN¥142.5b in 2025. This reflects a credible 6.2% improvement in revenue compared to the last 12 months. Per-share earnings are expected to expand 10% to CN¥4.12. Before this earnings report, the analysts had been forecasting revenues of CN¥142.0b and earnings per share (EPS) of CN¥4.06 in 2025. The consensus analysts don't seem to have seen anything in these results that would have changed their view on the business, given there's been no major change to their estimates.

Check out our latest analysis for Kuaishou Technology

With the analysts reconfirming their revenue and earnings forecasts, it's surprising to see that the price target rose 8.2% to HK$85.36. It looks as though they previously had some doubts over whether the business would live up to their expectations. 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 Kuaishou Technology, with the most bullish analyst valuing it at HK$100 and the most bearish at HK$65.03 per share. This shows there is still a bit of diversity in estimates, but analysts don't appear to be totally split on the stock as though it might be a success or failure situation.

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 pretty clear that there is an expectation that Kuaishou Technology's revenue growth will slow down substantially, with revenues to the end of 2025 expected to display 13% growth on an annualised basis. This is compared to a historical growth rate of 17% over the past five years. By way of comparison, the other companies in this industry with analyst coverage are forecast to grow their revenue at 9.0% annually. Even after the forecast slowdown in growth, it seems obvious that Kuaishou Technology is also expected to grow faster than the wider industry.

The Bottom Line

The most important thing to take away is that there's been no major change in sentiment, with the analysts reconfirming that the business is performing in line with their previous earnings per share estimates. Fortunately, they also reconfirmed their revenue numbers, suggesting that it's tracking in line with expectations. Additionally, our data suggests that revenue is expected to grow faster than the wider industry. There was also a nice increase in the price target, with the analysts clearly feeling that the intrinsic value of the business is improving.

Following on from that line of thought, we think that the long-term prospects of the business are much more relevant than next year's earnings. We have forecasts for Kuaishou Technology going out to 2027, and you can see them free on our platform here.

You can also see our analysis of Kuaishou Technology's Board and CEO remuneration and experience, and whether company insiders have been buying stock.

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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.