MINISO Group Holding Limited Beat Analyst Estimates: See What The Consensus Is Forecasting For This Year

MINISO Group Holding Limited (NYSE:MNSO) just released its quarterly report and things are looking bullish. It was overall a positive result, with revenues beating expectations by 2.8% to hit CN¥2.8b. MINISO Group Holding also reported a statutory profit of CN¥1.32, which was an impressive 55% above what the analysts had forecast. This is an important time for investors, as they can track a company's performance in its report, look at what experts are forecasting for next year, and see if there has been any change to expectations for the business. We've gathered the most recent statutory forecasts to see whether the analysts have changed their earnings models, following these results.

Our analysis indicates that MNSO is potentially undervalued!

Taking into account the latest results, the most recent consensus for MINISO Group Holding from seven analysts is for revenues of CN¥11.6b in 2023 which, if met, would be a notable 14% increase on its sales over the past 12 months. Per-share earnings are expected to bounce 38% to CN¥3.91. Before this earnings report, the analysts had been forecasting revenues of CN¥11.9b and earnings per share (EPS) of CN¥3.48 in 2023. While revenue forecasts have been revised downwards, the analysts look to have become more optimistic on the company's cost base, given the decent improvement in to the earnings per share numbers.

The average price target increased 6.8% to US$12.47, with the analysts signalling that the improved earnings outlook is more important to the company's valuation than its revenue. 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. Currently, the most bullish analyst values MINISO Group Holding at US$17.45 per share, while the most bearish prices it at US$9.71. With such a narrow range of valuations, the analysts apparently share similar views on what they think the business is worth.

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 MINISO Group Holding's rate of growth is expected to accelerate meaningfully, with the forecast 19% annualised revenue growth to the end of 2023 noticeably faster than its historical growth of 5.7% over the past year. Compare this with other companies in the same industry, which are forecast to grow their revenue 4.4% annually. Factoring in the forecast acceleration in revenue, it's pretty clear that MINISO Group Holding is expected to grow much faster than its industry.

The Bottom Line

The biggest takeaway for us is the consensus earnings per share upgrade, which suggests a clear improvement in sentiment around MINISO Group Holding's earnings potential next year. They also downgraded their revenue estimates, although industry data suggests that MINISO Group Holding's revenues are expected to grow faster than the wider industry. Still, earnings are more important to the intrinsic value of the business. 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 said, the long-term trajectory of the company's earnings is a lot more important than next year. At Simply Wall St, we have a full range of analyst estimates for MINISO Group Holding going out to 2025, and you can see them free on our platform here..

And what about risks? Every company has them, and we've spotted 2 warning signs for MINISO Group Holding you should know about.

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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.