Analyst Forecasts For XD Inc. (HKG:2400) Are Surging Higher

XD Inc. (HKG:2400) shareholders will have a reason to smile today, with the analysts making substantial upgrades to this year's forecasts. 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. Investor sentiment seems to be improving too, with the share price up 4.3% to HK$80.45 over the past 7 days. It will be interesting to see if this latest upgrade is enough to kickstart further buying interest in the stock.

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Following the upgrade, the latest consensus from XD's twelve analysts is for revenues of CN¥6.4b in 2025, which would reflect a decent 9.7% improvement in sales compared to the last 12 months. Statutory earnings per share are presumed to swell 16% to CN¥3.28. Previously, the analysts had been modelling revenues of CN¥5.8b and earnings per share (EPS) of CN¥2.35 in 2025. 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.

See our latest analysis for XD

It will come as no surprise to learn that the analysts have increased their price target for XD 26% to CN¥66.10 on the back of these upgrades. 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. Currently, the most bullish analyst values XD at CN¥85.71 per share, while the most bearish prices it at CN¥32.23. This is a fairly broad spread of estimates, suggesting that the analysts are forecasting a wide range of possible outcomes for the business.

Another way we can view these estimates is in the context of the bigger picture, such as how the forecasts stack up against past performance, and whether forecasts are more or less bullish relative to other companies in the industry. It's clear from the latest estimates that XD's rate of growth is expected to accelerate meaningfully, with the forecast 20% annualised revenue growth to the end of 2025 noticeably faster than its historical growth of 14% p.a. 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 8.7% per year. It seems obvious that, while the growth outlook is brighter than the recent past, the analysts also expect XD to grow faster than the wider 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. 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 XD.

With that said, the long-term trajectory of the company's earnings is a lot more important than next year. At Simply Wall St, we have a full range of analyst estimates for XD going out to 2027, and you can see them free on our platform here..

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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.