Analysts Just Published A Bright New Outlook For Pop Mart International Group Limited's (HKG:9992)

Shareholders in Pop Mart International Group Limited (HKG:9992) may be thrilled to learn that the analysts have just delivered a major upgrade to their near-term forecasts. The analysts greatly increased their revenue estimates, suggesting a stark improvement in business fundamentals.

This technology could replace computers: discover the 20 stocks are working to make quantum computing a reality.

Following the upgrade, the current consensus from Pop Mart International Group's 33 analysts is for revenues of CN¥37b in 2025 which - if met - would reflect a huge 64% increase on its sales over the past 12 months. Statutory earnings per share are presumed to leap 82% to CN¥9.31. Previously, the analysts had been modelling revenues of CN¥33b and earnings per share (EPS) of CN¥8.39 in 2025. There has definitely been an improvement in perception recently, with the analysts substantially increasing both their earnings and revenue estimates.

Check out our latest analysis for Pop Mart International Group

Although the analysts have upgraded their earnings estimates, there was no change to the consensus price target of CN¥333, suggesting that the forecast performance does not have a long term impact on the company's valuation. There's another way to think about price targets though, and that's to look at the range of price targets put forward by analysts, because a wide range of estimates could suggest a diverse view on possible outcomes for the business. Currently, the most bullish analyst values Pop Mart International Group at CN¥431 per share, while the most bearish prices it at CN¥156. This is a fairly broad spread of estimates, suggesting that the analysts are forecasting a wide range of possible outcomes for the business.

Of course, another way to look at these forecasts is to place them into context against the industry itself. The analysts are definitely expecting Pop Mart International Group's growth to accelerate, with the forecast 168% annualised growth to the end of 2025 ranking favourably alongside historical growth of 41% 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 16% per year. It seems obvious that, while the growth outlook is brighter than the recent past, the analysts also expect Pop Mart International Group to grow faster than the wider 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. The lack of change in the price target is puzzling, but with a serious upgrade to this year's earnings expectations, it might be time to take another look at Pop Mart International Group.

Using these estimates as a starting point, we've run a discounted cash flow calculation (DCF) on Pop Mart International Group that suggests the company could be somewhat 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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

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.