Pop Mart International Group Limited Beat Analyst Estimates: See What The Consensus Is Forecasting For This Year

Pop Mart International Group Limited (HKG:9992) shareholders are probably feeling a little disappointed, since its shares fell 8.9% to HK$56.40 in the week after its latest annual results. Revenues disappointed slightly, as sales of CN¥2.5b were 3.2% below what the analysts had predicted. Profits were a relative bright spot, with statutory per-share earnings of CN¥0.44 coming in 18% above what was anticipated. 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 gathered the latest post-earnings forecasts to see what estimates suggest is in store for next year.

See our latest analysis for Pop Mart International Group

Taking into account the latest results, the consensus forecast from Pop Mart International Group's seven analysts is for revenues of CN¥4.23b in 2021, which would reflect a substantial 68% improvement in sales compared to the last 12 months. Per-share earnings are expected to leap 77% to CN¥0.78. Yet prior to the latest earnings, the analysts had been anticipated revenues of CN¥4.34b and earnings per share (EPS) of CN¥0.80 in 2021. It's pretty clear that pessimism has reared its head after the latest results, leading to a weaker revenue outlook and a small dip in earnings per share estimates.

Despite the cuts to forecast earnings, there was no real change to the CN¥73.24 price target, showing that the analysts don't think the changes have a meaningful impact on its intrinsic value. 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. The most optimistic Pop Mart International Group analyst has a price target of CN¥106 per share, while the most pessimistic values it at CN¥63.00. 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.

Of course, another way to look at these forecasts is to place them into context against the industry itself. It's clear from the latest estimates that Pop Mart International Group's rate of growth is expected to accelerate meaningfully, with the forecast 68% annualised revenue growth to the end of 2021 noticeably faster than its historical growth of 52% p.a. over the past three years. Compare this with other companies in the same industry, which are forecast to grow their revenue 17% annually. Factoring in the forecast acceleration in revenue, it's pretty clear that Pop Mart International Group is expected to grow much faster than its industry.

The Bottom Line

The biggest concern is that the analysts reduced their earnings per share estimates, suggesting business headwinds could lay ahead for Pop Mart International Group. They also downgraded their revenue estimates, although industry data suggests that Pop Mart International Group's revenues are expected to grow faster than the wider industry. The consensus price target held steady at CN¥73.24, 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 Pop Mart International Group. Long-term earnings power is much more important than next year's profits. We have estimates - from multiple Pop Mart International Group analysts - going out to 2024, and you can see them free on our platform here.

Don't forget that there may still be risks. For instance, we've identified 1 warning sign for Pop Mart International Group that you should be aware of.

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This article by Simply Wall St is general in nature. 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.
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