Pou Sheng International (Holdings) Limited (HKG:3813) Half-Yearly Results Just Came Out: Here's What Analysts Are Forecasting For This Year

Pou Sheng International (Holdings) Limited (HKG:3813) last week reported its latest interim results, which makes it a good time for investors to dive in and see if the business is performing in line with expectations. It was a credible result overall, with revenues of CN¥10.0b and statutory earnings per share of CN¥0.095 both in line with analyst estimates, showing that Pou Sheng International (Holdings) is executing in line with expectations. 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. So we collected the latest post-earnings statutory consensus estimates to see what could be in store for next year.

See our latest analysis for Pou Sheng International (Holdings)

Following last week's earnings report, Pou Sheng International (Holdings)'s six analysts are forecasting 2024 revenues to be CN¥18.7b, approximately in line with the last 12 months. Per-share earnings are expected to accumulate 7.5% to CN¥0.11. Before this earnings report, the analysts had been forecasting revenues of CN¥18.9b and earnings per share (EPS) of CN¥0.12 in 2024. The analysts seem to have become a little more negative on the business after the latest results, given the minor downgrade to their earnings per share numbers for next year.

It might be a surprise to learn that the consensus price target was broadly unchanged at HK$1.17, with the analysts clearly implying that the forecast decline in earnings is not expected to have much of an impact on valuation. 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 Pou Sheng International (Holdings), with the most bullish analyst valuing it at HK$2.79 and the most bearish at HK$0.72 per share. So we wouldn't be assigning too much credibility to analyst price targets in this case, because there are clearly some widely different views on what kind of performance this business can generate. With this in mind, we wouldn't rely too heavily the consensus price target, as it is just an average and analysts clearly have some deeply divergent views on the business.

Looking at the bigger picture now, one of the ways we can make sense of these forecasts is to see how they measure up against both past performance and industry growth estimates. From these estimates it looks as though the analysts expect the years of declining revenue to come to an end, given the flat forecast out to 2024. That would be a definite improvement, given that the past five years have seen revenue shrink 8.6% annually. Compare this against analyst estimates for the broader industry, which suggest that (in aggregate) industry revenues are expected to grow 12% annually. So it's pretty clear that, although revenues are improving, Pou Sheng International (Holdings) is still expected to grow slower than the industry.

The Bottom Line

The biggest concern is that the analysts reduced their earnings per share estimates, suggesting business headwinds could lay ahead for Pou Sheng International (Holdings). On the plus side, there were no major changes to revenue estimates; although forecasts imply they will perform worse than the wider industry. There was no real change to the consensus price target, suggesting that the intrinsic value of the business has not undergone any major changes with the latest estimates.

With that in mind, we wouldn't be too quick to come to a conclusion on Pou Sheng International (Holdings). Long-term earnings power is much more important than next year's profits. We have forecasts for Pou Sheng International (Holdings) going out to 2026, and you can see them free on our platform here.

Plus, you should also learn about the 1 warning sign we've spotted with Pou Sheng International (Holdings) .

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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.