Hesai Group (NASDAQ:HSAI) Just Reported And Analysts Have Been Cutting Their Estimates

It's been a sad week for Hesai Group (NASDAQ:HSAI), who've watched their investment drop 15% to US$4.53 in the week since the company reported its first-quarter result. The results were positive, with revenue coming in at CN¥359m, beating analyst expectations by 6.5%. 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. With this in mind, we've gathered the latest statutory forecasts to see what the analysts are expecting for next year.

View our latest analysis for Hesai Group

Following the latest results, Hesai Group's eight analysts are now forecasting revenues of CN¥2.80b in 2024. This would be a major 55% improvement in revenue compared to the last 12 months. Losses are predicted to fall substantially, shrinking 38% to CN¥2.26. Before this earnings announcement, the analysts had been modelling revenues of CN¥2.95b and losses of CN¥1.75 per share in 2024. While this year's revenue estimates dropped there was also a sizeable expansion in loss per share expectations, suggesting the consensus has a bit of a mixed view on the stock.

There was no major change to the consensus price target of US$10.99, signalling that the business is performing roughly in line with expectations, despite lower earnings per share forecasts. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. The most optimistic Hesai Group analyst has a price target of US$16.14 per share, while the most pessimistic values it at US$6.00. This is a very narrow spread of estimates, implying either that Hesai Group is an easy company to value, or - more likely - the analysts are relying heavily on some key assumptions.

Of course, another way to look at these forecasts is to place them into context against the industry itself. It's clear from the latest estimates that Hesai Group's rate of growth is expected to accelerate meaningfully, with the forecast 79% annualised revenue growth to the end of 2024 noticeably faster than its historical growth of 44% p.a. over the past three years. Compare this with other companies in the same industry, which are forecast to grow their revenue 11% annually. Factoring in the forecast acceleration in revenue, it's pretty clear that Hesai Group is expected to grow much faster than its industry.

The Bottom Line

The most important thing to note is the forecast of increased losses next year, suggesting all may not be well at Hesai Group. Regrettably, they also downgraded their revenue estimates, but the latest forecasts still imply the business will 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 Hesai Group going out to 2026, and you can see them free on our platform here.

You should always think about risks though. Case in point, we've spotted 1 warning sign for Hesai Group 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.