Kanzhun Limited Just Missed Earnings - But Analysts Have Updated Their Models
It's been a pretty great week for Kanzhun Limited (NASDAQ:BZ) shareholders, with its shares surging 10% to US$18.95 in the week since its latest yearly results. It looks like a pretty bad result, all things considered. Although revenues of CN¥4.5b were in line with analyst predictions, statutory earnings fell badly short, missing estimates by 41% to hit CN¥0.24 per share. 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. So we gathered the latest post-earnings forecasts to see what estimates suggest is in store for next year.
Check out our latest analysis for Kanzhun
Taking into account the latest results, the current consensus from Kanzhun's twelve analysts is for revenues of CN¥5.99b in 2023, which would reflect a substantial 33% increase on its sales over the past 12 months. Per-share earnings are expected to bounce 473% to CN¥1.42. In the lead-up to this report, the analysts had been modelling revenues of CN¥6.24b and earnings per share (EPS) of CN¥1.79 in 2023. From this we can that sentiment has definitely become more bearish after the latest results, leading to lower revenue forecasts and a pretty serious reduction to earnings per share estimates.
The analysts made no major changes to their price target of US$23.81, suggesting the downgrades are not expected to have a long-term impact on Kanzhun's valuation. 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. There are some variant perceptions on Kanzhun, with the most bullish analyst valuing it at US$26.98 and the most bearish at US$16.64 per share. Still, with such a tight range of estimates, it suggeststhe analysts have a pretty good idea of what they think the company 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. The period to the end of 2023 brings more of the same, according to the analysts, with revenue forecast to display 33% growth on an annualised basis. That is in line with its 39% annual growth over the past three years. Compare this with the broader industry, which analyst estimates (in aggregate) suggest will see revenues grow 8.8% annually. So it's pretty clear that Kanzhun is forecast to grow substantially faster than its industry.
The Bottom Line
The biggest concern is that the analysts reduced their earnings per share estimates, suggesting business headwinds could lay ahead for Kanzhun. They also downgraded their revenue estimates, although industry data suggests that Kanzhun's revenues are expected to 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 Kanzhun going out to 2025, and you can see them free on our platform here.
It is also worth noting that we have found 1 warning sign for Kanzhun that you need to take into consideration.
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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.
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