Qfin Holdings, Inc. Just Beat Revenue By 12%: Here's What Analysts Think Will Happen Next

Qfin Holdings, Inc. (NASDAQ:QFIN) shareholders are probably feeling a little disappointed, since its shares fell 4.3% to US$31.95 in the week after its latest second-quarter results. It was a mildly positive result, with revenues exceeding expectations at CN¥5.2b, while statutory earnings per share (EPS) of CN¥12.76 were in line with analyst forecasts. 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. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether the analysts have changed their mind on Qfin Holdings after the latest results.

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Following the latest results, Qfin Holdings' eleven analysts are now forecasting revenues of CN¥19.9b in 2025. This would be a reasonable 6.0% improvement in revenue compared to the last 12 months. Statutory earnings per share are forecast to shrink 9.9% to CN¥49.33 in the same period. Yet prior to the latest earnings, the analysts had been anticipated revenues of CN¥18.7b and earnings per share (EPS) of CN¥49.99 in 2025. There doesn't appear to have been a major change in sentiment following the results, other than the modest lift to revenue estimates.

Check out our latest analysis for Qfin Holdings

Even though revenue forecasts increased, the consensus price target 6.1% to US$52.48, perhaps suggesting thatthe analysts have become more pessimistic about the lack of earnings growth. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. Currently, the most bullish analyst values Qfin Holdings at US$60.32 per share, while the most bearish prices it at US$39.97. This is a very narrow spread of estimates, implying either that Qfin Holdings is an easy company to value, or - more likely - the analysts are relying heavily on some key assumptions.

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Qfin Holdings' past performance and to peers in the same industry. It's clear from the latest estimates that Qfin Holdings' rate of growth is expected to accelerate meaningfully, with the forecast 12% annualised revenue growth to the end of 2025 noticeably faster than its historical growth of 5.8% p.a. over the past five years. Compare this with other companies in the same industry, which are forecast to grow their revenue 15% annually. Qfin Holdings is expected to grow at about the same rate as its industry, so it's not clear that we can draw any conclusions from its growth relative to competitors.

The Bottom Line

The most important thing to take away is that there's been no major change in sentiment, with the analysts reconfirming that the business is performing in line with their previous earnings per share estimates. There was also an upgrade to revenue estimates, although as we saw earlier, forecast growth is only expected to be about the same as the wider industry. Furthermore, the analysts also cut their price targets, suggesting that the latest news has led to greater pessimism about the intrinsic value of the business.

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 estimates - from multiple Qfin Holdings analysts - going out to 2027, and you can see them free on our platform here.

We don't want to rain on the parade too much, but we did also find 1 warning sign for Qfin Holdings that you need to be mindful 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.