Results: Asia Vital Components Co., Ltd. Exceeded Expectations And The Consensus Has Updated Its Estimates

A week ago, Asia Vital Components Co., Ltd. (TWSE:3017) came out with a strong set of quarterly numbers that could potentially lead to a re-rate of the stock. It was overall a positive result, with revenues beating expectations by 2.4% to hit NT$19b. Asia Vital Components reported statutory earnings per share (EPS) NT$6.02, which was a notable 12% above what the analysts had 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 Asia Vital Components

Taking into account the latest results, the consensus forecast from Asia Vital Components' 13 analysts is for revenues of NT$96.4b in 2025. This reflects a major 43% improvement in revenue compared to the last 12 months. Statutory earnings per share are predicted to surge 54% to NT$30.15. Before this earnings report, the analysts had been forecasting revenues of NT$95.3b and earnings per share (EPS) of NT$29.49 in 2025. So the consensus seems to have become somewhat more optimistic on Asia Vital Components' earnings potential following these results.

There's been no major changes to the consensus price target of NT$846, suggesting that the improved earnings per share outlook is not enough to have a long-term positive impact on the stock's valuation. That's not the only conclusion we can draw from this data however, as some investors also like to consider the spread in estimates when evaluating analyst price targets. There are some variant perceptions on Asia Vital Components, with the most bullish analyst valuing it at NT$1,000 and the most bearish at NT$625 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.

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. It's clear from the latest estimates that Asia Vital Components' rate of growth is expected to accelerate meaningfully, with the forecast 33% annualised revenue growth to the end of 2025 noticeably faster than its historical growth of 13% 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 21% per year. It seems obvious that, while the growth outlook is brighter than the recent past, the analysts also expect Asia Vital Components to grow faster than the wider 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 Asia Vital Components 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. The consensus price target held steady at NT$846, with the latest estimates not enough to have an impact on their price targets.

With that in mind, we wouldn't be too quick to come to a conclusion on Asia Vital Components. Long-term earnings power is much more important than next year's profits. We have estimates - from multiple Asia Vital Components analysts - going out to 2026, and you can see them free on our platform here.

Don't forget that there may still be risks. For instance, we've identified 1 warning sign for Asia Vital Components 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.