Analysts Are More Bearish On FDC International Hotels Corporation (TWSE:2748) Than They Used To Be

Today is shaping up negative for FDC International Hotels Corporation (TWSE:2748) shareholders, with the analysts delivering a substantial negative revision to this year's forecasts. Both revenue and earnings per share (EPS) estimates were cut sharply as analysts factored in the latest outlook for the business, concluding that they were too optimistic previously.

After the downgrade, the twin analysts covering FDC International Hotels are now predicting revenues of NT$2.5b in 2024. If met, this would reflect an okay 2.7% improvement in sales compared to the last 12 months. Per-share earnings are expected to climb 18% to NT$3.82. Before this latest update, the analysts had been forecasting revenues of NT$2.9b and earnings per share (EPS) of NT$4.33 in 2024. It looks like analyst sentiment has declined substantially, with a measurable cut to revenue estimates and a considerable drop in earnings per share numbers as well.

See our latest analysis for FDC International Hotels

The consensus price target fell 6.5% to NT$82.00, with the weaker earnings outlook clearly leading analyst valuation estimates.

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 FDC International Hotels' growth to accelerate, with the forecast 3.6% annualised growth to the end of 2024 ranking favourably alongside historical growth of 1.2% per annum 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 6.6% per year. It seems obvious that, while the future growth outlook is brighter than the recent past, FDC International Hotels is expected to grow slower than the wider industry.

The Bottom Line

The most important thing to take away is that analysts cut their earnings per share estimates, expecting a clear decline in business conditions. Regrettably, they also downgraded their revenue estimates, and the latest forecasts imply the business will grow sales slower than the wider market. With a serious cut to this year's expectations and a falling price target, we wouldn't be surprised if investors were becoming wary of FDC International Hotels.

Even so, the longer term trajectory of the business is much more important for the value creation of shareholders. We have analyst estimates for FDC International Hotels going out as far as 2025, and you can see them free on our platform here.

Of course, seeing company management invest large sums of money in a stock can be just as useful as knowing whether analysts are downgrading their estimates. So you may also wish to search this free list of stocks with high insider ownership.

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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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com