Shareholders in Legend Holdings Corporation (HKG:3396) may be thrilled to learn that the analysts have just delivered a major upgrade to their near-term forecasts. The revenue forecast for this year has experienced a facelift, with analysts now much more optimistic on its sales pipeline. Investor sentiment seems to be improving too, with the share price up 4.4% to HK$10.40 over the past 7 days. Could this big upgrade push the stock even higher?
After the upgrade, the twin analysts covering Legend Holdings are now predicting revenues of CN¥533b in 2022. If met, this would reflect a notable 8.5% improvement in sales compared to the last 12 months. Before the latest update, the analysts were foreseeing CN¥448b of revenue in 2022. The consensus has definitely become more optimistic, showing a substantial gain in revenue forecasts.
Of course, another way to look at these forecasts is to place them into context against the industry itself. The period to the end of 2022 brings more of the same, according to the analysts, with revenue forecast to display 8.5% growth on an annualised basis. That is in line with its 10.0% annual growth over the past five years. Compare this with the broader industry, which analyst estimates (in aggregate) suggest will see revenues grow 7.7% annually. It's clear that while Legend Holdings' revenue growth is expected to continue on its current trajectory, it's only expected to grow in line with the industry itself.
The Bottom Line
The highlight for us was that analysts increased their revenue forecasts for Legend Holdings this year. The analysts also expect revenues to grow approximately in line with the wider market. Given that analysts appear to be expecting substantial improvement in the sales pipeline, now could be the right time to take another look at Legend Holdings.
Analysts are clearly in love with Legend Holdings at the moment, but before diving in - you should be aware that we've identified some warning flags with the business, such as its declining profit margins. For more information, you can click through to our platform to learn more about this and the 2 other risks we've identified .
Of course, seeing company management invest large sums of money in a stock can be just as useful as knowing whether analysts are upgrading their estimates. So you may also wish to search this free list of stocks that insiders are buying.
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.