Earnings Miss: Sunonwealth Electric Machine Industry Co., Ltd. Missed EPS By 18% And Analysts Are Revising Their Forecasts

Shareholders might have noticed that Sunonwealth Electric Machine Industry Co., Ltd. (TWSE:2421) filed its third-quarter result this time last week. The early response was not positive, with shares down 4.0% to NT$98.40 in the past week. Revenues were in line with forecasts, at NT$4.0b, although statutory earnings per share came in 18% below what the analysts expected, at NT$1.28 per share. 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. With this in mind, we've gathered the latest statutory forecasts to see what the analysts are expecting for next year.

Check out our latest analysis for Sunonwealth Electric Machine Industry

Taking into account the latest results, the consensus forecast from Sunonwealth Electric Machine Industry's four analysts is for revenues of NT$17.4b in 2025. This reflects a substantial 24% improvement in revenue compared to the last 12 months. Statutory earnings per share are predicted to surge 59% to NT$7.52. In the lead-up to this report, the analysts had been modelling revenues of NT$17.5b and earnings per share (EPS) of NT$7.52 in 2025. The consensus analysts don't seem to have seen anything in these results that would have changed their view on the business, given there's been no major change to their estimates.

It will come as no surprise then, to learn that the consensus price target is largely unchanged at NT$139. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. Currently, the most bullish analyst values Sunonwealth Electric Machine Industry at NT$160 per share, while the most bearish prices it at NT$120. Still, with such a tight range of estimates, it suggeststhe analysts have a pretty good idea of what they think the company is worth.

Looking at the bigger picture now, one of the ways we can make sense of these forecasts is to see how they measure up against both past performance and industry growth estimates. It's clear from the latest estimates that Sunonwealth Electric Machine Industry's rate of growth is expected to accelerate meaningfully, with the forecast 19% annualised revenue growth to the end of 2025 noticeably faster than its historical growth of 2.8% p.a. 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 14% per year. It seems obvious that, while the growth outlook is brighter than the recent past, the analysts also expect Sunonwealth Electric Machine Industry to grow faster than the wider industry.

The Bottom Line

The most important thing to take away is that there's been no major change in sentiment, with the analysts reconfirming that the business is performing in line with their previous earnings per share estimates. Happily, there were no major changes to revenue forecasts, with the business still expected to grow faster than the wider industry. There was no real change to the consensus price target, suggesting that the intrinsic value of the business has not undergone any major changes with the latest estimates.

With that said, the long-term trajectory of the company's earnings is a lot more important than next year. We have estimates - from multiple Sunonwealth Electric Machine Industry analysts - 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 Sunonwealth Electric Machine Industry that you need to be mindful of.

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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.