The analysts might have been a bit too bullish on Topchoice Medical Co., Inc. (SHSE:600763), given that the company fell short of expectations when it released its first-quarter results last week. Results look to have been somewhat negative - revenue fell 4.5% short of analyst estimates at CN¥708m, and statutory earnings of CN¥0.54 per share missed forecasts by 3.6%. 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. So we collected the latest post-earnings statutory consensus estimates to see what could be in store for next year.

Taking into account the latest results, the most recent consensus for Topchoice Medical from eleven analysts is for revenues of CN¥3.08b in 2024. If met, it would imply an okay 6.8% increase on its revenue over the past 12 months. Statutory earnings per share are predicted to bounce 43% to CN¥2.25. Yet prior to the latest earnings, the analysts had been anticipated revenues of CN¥3.48b and earnings per share (EPS) of CN¥2.35 in 2024. Indeed, we can see that sentiment has declined measurably after results came out, with a real cut to revenue estimates and a small dip in EPS estimates to boot.

The analysts made no major changes to their price target of CN¥86.58, suggesting the downgrades are not expected to have a long-term impact on Topchoice Medical's valuation. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. There are some variant perceptions on Topchoice Medical, with the most bullish analyst valuing it at CN¥113 and the most bearish at CN¥59.00 per share. Note the wide gap in analyst price targets? This implies to us that there is a fairly broad range of possible scenarios for the underlying business.

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Topchoice Medical's past performance and to peers in the same industry. We can infer from the latest estimates that forecasts expect a continuation of Topchoice Medical'shistorical trends, as the 9.2% annualised revenue growth to the end of 2024 is roughly in line with the 11% annual growth over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to see their revenues grow 14% per year. So although Topchoice Medical is expected to maintain its revenue growth rate, it's forecast to grow slower than the wider industry.

The Bottom Line

The biggest concern is that the analysts reduced their earnings per share estimates, suggesting business headwinds could lay ahead for Topchoice Medical. Unfortunately, they also downgraded their revenue estimates, and our data indicates underperformance compared to the wider industry. Even so, earnings per share are more important to the intrinsic value of the business. The consensus price target held steady at CN¥86.58, with the latest estimates not enough to have an impact on their price targets.

With that in mind, we wouldn't be too quick to come to a conclusion on Topchoice Medical. Long-term earnings power is much more important than next year's profits. At Simply Wall St, we have a full range of analyst estimates for Topchoice Medical going out to 2026, and you can see them free on our platform here..

Plus, you should also learn about the 1 warning sign we've spotted with Topchoice Medical .

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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.