MediaTek Inc. Beat Analyst Estimates: See What The Consensus Is Forecasting For This Year

There's been a notable change in appetite for MediaTek Inc. (TWSE:2454) shares in the week since its quarterly report, with the stock down 12% to NT$1,090. Revenues were NT$127b, approximately in line with expectations, although statutory earnings per share (EPS) performed substantially better. EPS of NT$16.19 were also better than expected, beating analyst predictions by 17%. 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.

Check out our latest analysis for MediaTek

Following the latest results, MediaTek's 21 analysts are now forecasting revenues of NT$514.8b in 2024. This would be a credible 2.9% improvement in revenue compared to the last 12 months. Statutory per-share earnings are expected to be NT$62.75, roughly flat on the last 12 months. Before this earnings report, the analysts had been forecasting revenues of NT$516.7b and earnings per share (EPS) of NT$61.13 in 2024. So the consensus seems to have become somewhat more optimistic on MediaTek's earnings potential following these results.

There's been no major changes to the consensus price target of NT$1,373, suggesting that the improved earnings per share outlook is not enough to have a long-term positive impact on the stock's valuation. The consensus price target is just an average of individual analyst targets, so - it could be handy to see how wide the range of underlying estimates is. There are some variant perceptions on MediaTek, with the most bullish analyst valuing it at NT$1,680 and the most bearish at NT$1,040 per share. As you can see, analysts are not all in agreement on the stock's future, but the range of estimates is still reasonably narrow, which could suggest that the outcome is not totally unpredictable.

Another way we can view these estimates is in the context of the bigger picture, such as how the forecasts stack up against past performance, and whether forecasts are more or less bullish relative to other companies in the industry. It's pretty clear that there is an expectation that MediaTek's revenue growth will slow down substantially, with revenues to the end of 2024 expected to display 5.8% growth on an annualised basis. This is compared to a historical growth rate of 14% over the past five years. Compare this against other companies (with analyst forecasts) in the industry, which are in aggregate expected to see revenue growth of 16% annually. Factoring in the forecast slowdown in growth, it seems obvious that MediaTek is also expected to grow slower than other industry participants.

The Bottom Line

The biggest takeaway for us is the consensus earnings per share upgrade, which suggests a clear improvement in sentiment around MediaTek's earnings potential next year. On the plus side, there were no major changes to revenue estimates; although forecasts imply they will perform worse than the wider industry. The consensus price target held steady at NT$1,373, 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 MediaTek going out to 2026, and you can see them free on our platform here..

You still need to take note of risks, for example - MediaTek has 1 warning sign we think you should be aware 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.

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