Hiwin Technologies Corporation Earnings Missed Analyst Estimates: Here's What Analysts Are Forecasting Now

Last week saw the newest first-quarter earnings release from Hiwin Technologies Corporation (TWSE:2049), an important milestone in the company's journey to build a stronger business. It was not a great result overall. While revenues of NT$5.5b were in line with analyst predictions, earnings were less than expected, missing statutory estimates by 10% to hit NT$1.12 per share. The analysts typically update their forecasts at each earnings report, and we can judge from their estimates whether their view of the company has changed or if there are any new concerns to be aware of. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether the analysts have changed their mind on Hiwin Technologies after the latest results.

View our latest analysis for Hiwin Technologies

Following the latest results, Hiwin Technologies' twelve analysts are now forecasting revenues of NT$25.6b in 2024. This would be an okay 4.7% improvement in revenue compared to the last 12 months. Per-share earnings are expected to leap 31% to NT$7.37. Yet prior to the latest earnings, the analysts had been anticipated revenues of NT$26.5b and earnings per share (EPS) of NT$8.05 in 2024. The analysts are less bullish than they were before these results, given the reduced revenue forecasts and the small dip in earnings per share expectations.

The analysts made no major changes to their price target of NT$267, suggesting the downgrades are not expected to have a long-term impact on Hiwin Technologies' valuation. Fixating on a single price target can be unwise though, since the consensus target is effectively the average of analyst price targets. As a result, some investors like to look at the range of estimates to see if there are any diverging opinions on the company's valuation. The most optimistic Hiwin Technologies analyst has a price target of NT$322 per share, while the most pessimistic values it at NT$160. Note the wide gap in analyst price targets? This implies to us that there is a fairly broad range of possible scenarios for the underlying business.

One way to get more context on these forecasts is to look at how they compare to both past performance, and how other companies in the same industry are performing. The analysts are definitely expecting Hiwin Technologies' growth to accelerate, with the forecast 6.4% annualised growth to the end of 2024 ranking favourably alongside historical growth of 4.1% per annum over the past five years. Compare this with other companies in the same industry, which are forecast to see revenue growth of 13% annually. So it's clear that despite the acceleration in growth, Hiwin Technologies is expected to grow meaningfully slower than the industry average.

The Bottom Line

The biggest concern is that the analysts reduced their earnings per share estimates, suggesting business headwinds could lay ahead for Hiwin Technologies. On the negative side, they also downgraded their revenue estimates, and forecasts imply they will perform worse than the wider industry. The consensus price target held steady at NT$267, with the latest estimates not enough to have an impact on their price targets.

Following on from that line of thought, we think that the long-term prospects of the business are much more relevant than next year's earnings. At Simply Wall St, we have a full range of analyst estimates for Hiwin Technologies going out to 2026, and you can see them free on our platform here..

We don't want to rain on the parade too much, but we did also find 2 warning signs for Hiwin Technologies that you need to be mindful of.

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.