United Microelectronics Corporation Beat Analyst Estimates: See What The Consensus Is Forecasting For This Year

It's been a good week for United Microelectronics Corporation (TWSE:2303) shareholders, because the company has just released its latest quarterly results, and the shares gained 4.3% to NT$52.90. It looks like a credible result overall - although revenues of NT$57b were what the analysts expected, United Microelectronics surprised by delivering a (statutory) profit of NT$1.11 per share, an impressive 24% above what was forecast. Following the result, the analysts have updated their earnings model, and it would be good to know whether they think there's been a strong change in the company's prospects, or if it's business as usual. We've gathered the most recent statutory forecasts to see whether the analysts have changed their earnings models, following these results.

See our latest analysis for United Microelectronics

Taking into account the latest results, the consensus forecast from United Microelectronics' 21 analysts is for revenues of NT$234.1b in 2024. This reflects a credible 4.7% improvement in revenue compared to the last 12 months. Statutory per share are forecast to be NT$4.08, approximately in line with the last 12 months. In the lead-up to this report, the analysts had been modelling revenues of NT$235.4b and earnings per share (EPS) of NT$3.74 in 2024. So the consensus seems to have become somewhat more optimistic on United Microelectronics' earnings potential following these results.

The consensus price target was unchanged at NT$58.05, implying that the improved earnings outlook is not expected to have a long term impact on value creation for shareholders. There's another way to think about price targets though, and that's to look at the range of price targets put forward by analysts, because a wide range of estimates could suggest a diverse view on possible outcomes for the business. The most optimistic United Microelectronics analyst has a price target of NT$70.00 per share, while the most pessimistic values it at NT$34.00. 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. We can infer from the latest estimates that forecasts expect a continuation of United Microelectronics'historical trends, as the 9.7% annualised revenue growth to the end of 2024 is roughly in line with the 11% annual growth over the past five years. Compare this with the broader industry (in aggregate), which analyst estimates suggest will see revenues grow 16% annually. So although United Microelectronics is expected to maintain its revenue growth rate, it's forecast to grow slower than 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 United Microelectronics' earnings potential next year. Fortunately, the analysts also reconfirmed their revenue estimates, suggesting that it's tracking in line with expectations. Although our data does suggest that United Microelectronics' revenue is expected to perform worse than the wider industry. The consensus price target held steady at NT$58.05, 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. We have estimates - from multiple United Microelectronics analysts - going out to 2026, and you can see them free on our platform here.

However, before you get too enthused, we've discovered 2 warning signs for United Microelectronics (1 is a bit concerning!) that you should be aware 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.

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