Results: Quanta Computer Inc. Beat Earnings Expectations And Analysts Now Have New Forecasts

Quanta Computer Inc. (TWSE:2382) just released its quarterly report and things are looking bullish. It was overall a positive result, with revenues beating expectations by 4.0% to hit NT$310b. Quanta Computer also reported a statutory profit of NT$3.92, which was an impressive 41% above what the analysts had forecast. Earnings are an important time for investors, as they can track a company's performance, look at what the analysts are forecasting for next year, and see if there's been a change in sentiment towards the company. We thought readers would find it interesting to see the analysts latest (statutory) post-earnings forecasts for next year.

See our latest analysis for Quanta Computer

After the latest results, the 16 analysts covering Quanta Computer are now predicting revenues of NT$1.46t in 2024. If met, this would reflect a major 28% improvement in revenue compared to the last 12 months. Per-share earnings are expected to step up 15% to NT$14.97. Before this earnings report, the analysts had been forecasting revenues of NT$1.48t and earnings per share (EPS) of NT$13.80 in 2024. So the consensus seems to have become somewhat more optimistic on Quanta Computer's earnings potential following these results.

The consensus price target was unchanged at NT$363, implying that the improved earnings outlook is not expected to have a long term impact on value creation for shareholders. Fixating on a single price target can be unwise though, since the consensus target is effectively the average of analyst price targets. As a result, some investors like to look at the range of estimates to see if there are any diverging opinions on the company's valuation. There are some variant perceptions on Quanta Computer, with the most bullish analyst valuing it at NT$425 and the most bearish at NT$250 per share. This shows there is still a bit of diversity in estimates, but analysts don't appear to be totally split on the stock as though it might be a success or failure situation.

Looking at the bigger picture now, one of the ways we can make sense of these forecasts is to see how they measure up against both past performance and industry growth estimates. The analysts are definitely expecting Quanta Computer's growth to accelerate, with the forecast 64% annualised growth to the end of 2024 ranking favourably alongside historical growth of 2.6% per annum over the past five years. Compare this with other companies in the same industry, which are forecast to grow their revenue 20% annually. Factoring in the forecast acceleration in revenue, it's pretty clear that Quanta Computer is expected to grow much faster than its industry.

The Bottom Line

The most important thing here is that the analysts upgraded their earnings per share estimates, suggesting that there has been a clear increase in optimism towards Quanta Computer following these results. Happily, there were no major changes to revenue forecasts, with the business still 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.

Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. We have forecasts for Quanta Computer going out to 2026, and you can see them free on our platform here.

It is also worth noting that we have found 1 warning sign for Quanta Computer that you need to take into consideration.

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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.