Chicony Electronics Co., Ltd. (TWSE:2385) Released Earnings Last Week And Analysts Lifted Their Price Target To NT$262

Investors in Chicony Electronics Co., Ltd. (TWSE:2385) had a good week, as its shares rose 7.8% to close at NT$241 following the release of its full-year results. The result was positive overall - although revenues of NT$98b were in line with what the analysts predicted, Chicony Electronics surprised by delivering a statutory profit of NT$10.35 per share, modestly greater than expected. 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. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether the analysts have changed their mind on Chicony Electronics after the latest results.

Check out our latest analysis for Chicony Electronics

After the latest results, the three analysts covering Chicony Electronics are now predicting revenues of NT$109.1b in 2024. If met, this would reflect a notable 11% improvement in revenue compared to the last 12 months. Statutory earnings per share are predicted to leap 21% to NT$12.50. Before this earnings report, the analysts had been forecasting revenues of NT$106.9b and earnings per share (EPS) of NT$11.09 in 2024. There's been a pretty noticeable increase in sentiment, with the analysts upgrading revenues and making a substantial gain in earnings per share in particular.

With these upgrades, we're not surprised to see that the analysts have lifted their price target 52% to NT$262per share. 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 Chicony Electronics, with the most bullish analyst valuing it at NT$280 and the most bearish at NT$247 per share. Still, with such a tight range of estimates, it suggeststhe analysts have a pretty good idea of what they think the company is worth.

Taking a look at the bigger picture now, one of the ways we can understand these forecasts is to see how they compare to both past performance and industry growth estimates. It's clear from the latest estimates that Chicony Electronics' rate of growth is expected to accelerate meaningfully, with the forecast 11% annualised revenue growth to the end of 2024 noticeably faster than its historical growth of 4.7% p.a. 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 16% per year. It seems obvious that, while the future growth outlook is brighter than the recent past, Chicony Electronics is expected 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 Chicony Electronics' earnings potential next year. Fortunately, they also upgraded their revenue estimates, although our data indicates it is expected to perform worse than the wider industry. We note an upgrade to the price target, suggesting that the analysts believes the intrinsic value of the business is likely to improve over time.

With that in mind, we wouldn't be too quick to come to a conclusion on Chicony Electronics. 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 Chicony Electronics going out to 2025, and you can see them free on our platform here..

You can also see our analysis of Chicony Electronics' Board and CEO remuneration and experience, and whether company insiders have been buying stock.

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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.