Ever Sunshine Lifestyle Services Group Limited (HKG:1995) just released its latest full-year results and things are looking bullish. Results were good overall, with revenues beating analyst predictions by 7.5% to hit CN¥1.9b. Statutory earnings per share (EPS) came in at CN¥0.15, some 4.6% above whatthe analysts had expected. 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.
Taking into account the latest results, the most recent consensus for Ever Sunshine Lifestyle Services Group from twelve analysts is for revenues of CN¥2.99b in 2020 which, if met, would be a huge 59% increase on its sales over the past 12 months. Statutory earnings per share are predicted to surge 53% to CN¥0.22. Before this earnings report, the analysts had been forecasting revenues of CN¥2.66b and earnings per share (EPS) of CN¥0.21 in 2020. The analysts seem more optimistic after the latest results, with a nice gain to revenue and a slight bump in earnings per share estimates.
It will come as no surprise to learn that the analysts have increased their price target for Ever Sunshine Lifestyle Services Group 11% to CN¥8.51 on the back of these upgrades. The consensus price target is just an average of individual analyst targets, so - it could be handy to see how wide the range of underlying estimates is. There are some variant perceptions on Ever Sunshine Lifestyle Services Group, with the most bullish analyst valuing it at CN¥10.57 and the most bearish at CN¥4.04 per share. This is a fairly broad spread of estimates, suggesting that analysts are forecasting a wide range of possible outcomes for the business.
Taking a look at the bigger picture now, one of the ways we can understand these forecasts is to see how they compare to both past performance and industry growth estimates. The analysts are definitely expecting Ever Sunshine Lifestyle Services Group's growth to accelerate, with the forecast 59% growth ranking favourably alongside historical growth of 41% per annum over the past three years. Compare this with other companies in the same industry, which are forecast to grow their revenue 22% next year. Factoring in the forecast acceleration in revenue, it's pretty clear that Ever Sunshine Lifestyle Services Group is expected to grow much faster than its 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 Ever Sunshine Lifestyle Services Group following these results. Happily, they also upgraded their revenue estimates, and are forecasting revenues to grow faster than the wider industry. There was also a nice increase in the price target, with the analysts clearly feeling that the intrinsic value of the business is improving.
With that in mind, we wouldn't be too quick to come to a conclusion on Ever Sunshine Lifestyle Services Group. Long-term earnings power is much more important than next year's profits. We have forecasts for Ever Sunshine Lifestyle Services Group going out to 2022, and you can see them free on our platform here.
You still need to take note of risks, for example - Ever Sunshine Lifestyle Services Group has 2 warning signs we think you should be aware of.
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