Here's What Analysts Are Forecasting For H World Group Limited (NASDAQ:HTHT) After Its First-Quarter Results

Last week, you might have seen that H World Group Limited (NASDAQ:HTHT) released its first-quarter result to the market. The early response was not positive, with shares down 2.4% to US$39.72 in the past week. It was an okay result overall, with revenues coming in at CN¥5.3b, roughly what the analysts had been expecting. 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.

Check out our latest analysis for H World Group

Taking into account the latest results, the most recent consensus for H World Group from 22 analysts is for revenues of CN¥24.3b in 2024. If met, it would imply a reasonable 7.1% increase on its revenue over the past 12 months. Per-share earnings are expected to grow 15% to CN¥13.80. In the lead-up to this report, the analysts had been modelling revenues of CN¥24.1b and earnings per share (EPS) of CN¥13.59 in 2024. So it's pretty clear that, although the analysts have updated their estimates, there's been no major change in expectations for the business following the latest results.

It will come as no surprise then, to learn that the consensus price target is largely unchanged at US$52.23. There's another way to think about price targets though, and that's to look at the range of price targets put forward by analysts, because a wide range of estimates could suggest a diverse view on possible outcomes for the business. The most optimistic H World Group analyst has a price target of US$63.89 per share, while the most pessimistic values it at US$43.92. With such a narrow range of valuations, the analysts apparently share similar views on what they think the business is worth.

Another way we can view these estimates is in the context of the bigger picture, such as how the forecasts stack up against past performance, and whether forecasts are more or less bullish relative to other companies in the industry. It's pretty clear that there is an expectation that H World Group's revenue growth will slow down substantially, with revenues to the end of 2024 expected to display 9.5% growth on an annualised basis. This is compared to a historical growth rate of 16% over the past five years. Juxtapose this against the other companies in the industry with analyst coverage, which are forecast to grow their revenues (in aggregate) 9.8% annually. Factoring in the forecast slowdown in growth, it looks like H World Group is forecast to grow at about the same rate as the wider industry.

The Bottom Line

The most obvious conclusion is that there's been no major change in the business' prospects in recent times, with the analysts holding their earnings forecasts steady, in line with previous estimates. They also reconfirmed their revenue estimates, with the company predicted to grow at about the same rate as 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.

Following on from that line of thought, we think that the long-term prospects of the business are much more relevant than next year's earnings. We have estimates - from multiple H World Group analysts - going out to 2026, and you can see them free on our platform here.

You still need to take note of risks, for example - H World Group has 1 warning sign we think 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.