Revenue Beat: Damai Entertainment Holdings Limited Beat Analyst Estimates By 11%

It's been a sad week for Damai Entertainment Holdings Limited (HKG:1060), who've watched their investment drop 14% to HK$0.88 in the week since the company reported its interim result. Damai Entertainment Holdings beat revenue forecasts by a solid 11% to hit CN¥4.1b. Statutory earnings per share came in at CN¥0.012, in line with expectations. 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.

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Taking into account the latest results, the consensus forecast from Damai Entertainment Holdings' 13 analysts is for revenues of CN¥7.90b in 2026. This reflects a credible 2.6% improvement in revenue compared to the last 12 months. Per-share earnings are expected to leap 60% to CN¥0.029. Before this earnings report, the analysts had been forecasting revenues of CN¥7.65b and earnings per share (EPS) of CN¥0.03 in 2026. So it's pretty clear consensus is mixed on Damai Entertainment Holdings after the latest results; whilethe analysts lifted revenue numbers, they also administered a minor downgrade to per-share earnings expectations.

See our latest analysis for Damai Entertainment Holdings

The consensus price target was unchanged at HK$1.27, suggesting the business is performing roughly in line with expectations, despite some adjustments to profit and revenue forecasts. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. There are some variant perceptions on Damai Entertainment Holdings, with the most bullish analyst valuing it at HK$1.40 and the most bearish at HK$1.15 per share. With such a narrow range of valuations, the analysts apparently share similar views on what they think the business is worth.

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Damai Entertainment Holdings' past performance and to peers in the same industry. It's pretty clear that there is an expectation that Damai Entertainment Holdings' revenue growth will slow down substantially, with revenues to the end of 2026 expected to display 5.3% growth on an annualised basis. This is compared to a historical growth rate of 22% over the past five years. Compare this against other companies (with analyst forecasts) in the industry, which are in aggregate expected to see revenue growth of 8.7% annually. So it's pretty clear that, while revenue growth is expected to slow down, the wider industry is also expected to grow faster than Damai Entertainment Holdings.

The Bottom Line

The biggest concern is that the analysts reduced their earnings per share estimates, suggesting business headwinds could lay ahead for Damai Entertainment Holdings. Fortunately, they also upgraded their revenue estimates, although our data indicates it is expected to perform worse than the wider industry. The consensus price target held steady at HK$1.27, with the latest estimates not enough to have an impact on their price targets.

With that in mind, we wouldn't be too quick to come to a conclusion on Damai Entertainment Holdings. Long-term earnings power is much more important than next year's profits. We have estimates - from multiple Damai Entertainment Holdings analysts - going out to 2028, and you can see them free on our platform here.

And what about risks? Every company has them, and we've spotted 1 warning sign for Damai Entertainment Holdings you should know about.

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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.