Sunonwealth Electric Machine Industry Co., Ltd. Just Missed EPS By 9.6%: Here's What Analysts Think Will Happen Next

Sunonwealth Electric Machine Industry Co., Ltd. (TWSE:2421) shareholders are probably feeling a little disappointed, since its shares fell 6.1% to NT$123 in the week after its latest annual results. Revenues of NT$13b were in line with forecasts, although statutory earnings per share (EPS) came in below expectations at NT$5.07, missing estimates by 9.6%. 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. With this in mind, we've gathered the latest statutory forecasts to see what the analysts are expecting for next year.

View our latest analysis for Sunonwealth Electric Machine Industry

Taking into account the latest results, the most recent consensus for Sunonwealth Electric Machine Industry from five analysts is for revenues of NT$15.3b in 2024. If met, it would imply a decent 18% increase on its revenue over the past 12 months. Per-share earnings are expected to jump 47% to NT$7.20. Before this earnings report, the analysts had been forecasting revenues of NT$14.9b and earnings per share (EPS) of NT$7.14 in 2024. So it looks like there's been no major change in sentiment following the latest results, although the analysts have made a slight bump in to revenue forecasts.

Even though revenue forecasts increased, there was no change to the consensus price target of NT$143, suggesting the analysts are focused on earnings as the driver of value creation. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. There are some variant perceptions on Sunonwealth Electric Machine Industry, with the most bullish analyst valuing it at NT$160 and the most bearish at NT$105 per share. There are definitely some different views on the stock, but the range of estimates is not wide enough as to imply that the situation is unforecastable, in our view.

Taking a look at the bigger picture now, one of the ways we can understand these forecasts is to see how they compare to 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 18% annualised revenue growth to the end of 2024 noticeably faster than its historical growth of 4.0% 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, they also upgraded their revenue estimates, and are forecasting them to grow faster than the wider industry. The consensus price target held steady at NT$143, with the latest estimates not enough to have an impact on their price targets.

Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. At Simply Wall St, we have a full range of analyst estimates for Sunonwealth Electric Machine Industry going out to 2025, and you can see them free on our platform here..

Even so, be aware that Sunonwealth Electric Machine Industry is showing 3 warning signs in our investment analysis , you should know about...

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.