Concord New Energy Group Limited (HKG:182) Just Reported And Analysts Have Been Lifting Their Price Targets

Concord New Energy Group Limited (HKG:182) investors will be delighted, with the company turning in some strong numbers with its latest results. The company beat expectations with revenues of CN¥2.0b arriving 4.3% ahead of forecasts. Statutory earnings per share (EPS) were CN¥0.079, 3.2% ahead of estimates. Earnings are an important time for investors, as they can track a company's performance, look at what the analysts are forecasting for next year, and see if there's been a change in sentiment towards the company. We've gathered the most recent statutory forecasts to see whether the analysts have changed their earnings models, following these results.

Check out our latest analysis for Concord New Energy Group

After the latest results, the twin analysts covering Concord New Energy Group are now predicting revenues of CN¥2.12b in 2021. If met, this would reflect a reasonable 5.7% improvement in sales compared to the last 12 months. Statutory earnings per share are predicted to leap 27% to CN¥0.10. In the lead-up to this report, the analysts had been modelling revenues of CN¥2.13b and earnings per share (EPS) of CN¥0.086 in 2021. Although the revenue estimates have not really changed, we can see there's been a massive increase in earnings per share expectations, suggesting that the analysts have become more bullish after the latest result.

The analysts have been lifting their price targets on the back of the earnings upgrade, with the consensus price target rising 46% to HK$0.75.

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. One thing stands out from these estimates, which is that Concord New Energy Group is forecast to grow faster in the future than it has in the past, with revenues expected to display 5.7% annualised growth until the end of 2021. If achieved, this would be a much better result than the 8.5% annual decline over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to see their revenue grow 5.1% per year. So it looks like Concord New Energy Group is expected to grow at about the same rate as the wider industry.

The Bottom Line

The biggest takeaway for us is the consensus earnings per share upgrade, which suggests a clear improvement in sentiment around Concord New Energy Group's earnings potential next year. Happily, there were no real changes to sales forecasts, with the business still expected to grow in line with the overall industry. There was also a nice increase in the price target, with the analysts clearly feeling that the intrinsic value of the business is improving.

With that said, the long-term trajectory of the company's earnings is a lot more important than next year. We have analyst estimates for Concord New Energy Group going out as far as 2023, and you can see them free on our platform here.

Even so, be aware that Concord New Energy Group is showing 2 warning signs in our investment analysis , and 1 of those is significant...

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