The Hon Hai Precision Industry Co., Ltd. (TWSE:2317) Full-Year Results Are Out And Analysts Have Published New Forecasts

Last week saw the newest yearly earnings release from Hon Hai Precision Industry Co., Ltd. (TWSE:2317), an important milestone in the company's journey to build a stronger business. Revenues of NT$6.9t were in line with forecasts, although statutory earnings per share (EPS) came in below expectations at NT$11.01, missing estimates by 3.5%. The analysts typically update their forecasts at each earnings report, and we can judge from their estimates whether their view of the company has changed or if there are any new concerns to be aware of. So we gathered the latest post-earnings forecasts to see what estimates suggest is in store for next year.

View our latest analysis for Hon Hai Precision Industry

Taking into account the latest results, the most recent consensus for Hon Hai Precision Industry from 18 analysts is for revenues of NT$8.35t in 2025. If met, it would imply a substantial 22% increase on its revenue over the past 12 months. Per-share earnings are expected to soar 28% to NT$14.03. In the lead-up to this report, the analysts had been modelling revenues of NT$8.41t and earnings per share (EPS) of NT$14.70 in 2025. The analysts seem to have become a little more negative on the business after the latest results, given the small dip in their earnings per share numbers for next year.

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It might be a surprise to learn that the consensus price target was broadly unchanged at NT$229, with the analysts clearly implying that the forecast decline in earnings is not expected to have much of an impact on 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 Hon Hai Precision Industry, with the most bullish analyst valuing it at NT$270 and the most bearish at NT$185 per share. These price targets show that analysts do have some differing views on the business, but the estimates do not vary enough to suggest to us that some are betting on wild success or utter failure.

Of course, another way to look at these forecasts is to place them into context against the industry itself. The analysts are definitely expecting Hon Hai Precision Industry's growth to accelerate, with the forecast 22% annualised growth to the end of 2025 ranking favourably alongside historical growth of 4.8% per annum over the past five years. Compare this with other companies in the same industry, which are forecast to grow their revenue 12% annually. Factoring in the forecast acceleration in revenue, it's pretty clear that Hon Hai Precision Industry is expected to grow much faster than its industry.

The Bottom Line

The most important thing to take away is that the analysts downgraded their earnings per share estimates, showing that there has been a clear decline in sentiment following these results. Fortunately, they also reconfirmed their revenue numbers, suggesting that it's tracking in line with expectations. Additionally, our data suggests that revenue is 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 in mind, we wouldn't be too quick to come to a conclusion on Hon Hai Precision Industry. Long-term earnings power is much more important than next year's profits. At Simply Wall St, we have a full range of analyst estimates for Hon Hai Precision Industry going out to 2027, and you can see them free on our platform here..

And what about risks? Every company has them, and we've spotted 1 warning sign for Hon Hai Precision Industry you should know about.

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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.