Celebrations may be in order for Paradise Entertainment Limited (HKG:1180) shareholders, with the covering analyst delivering a significant upgrade to their statutory estimates for the company. Consensus estimates suggest investors could expect greatly increased statutory revenues and earnings per share, with the analyst modelling a real improvement in business performance.
Following the upgrade, the most recent consensus for Paradise Entertainment from its lone analyst is for revenues of HK$1.1b in 2025 which, if met, would be a modest 5.9% increase on its sales over the past 12 months. Per-share earnings are expected to accumulate 8.7% to HK$0.37. Prior to this update, the analyst had been forecasting revenues of HK$922m and earnings per share (EPS) of HK$0.27 in 2025. There has definitely been an improvement in perception recently, with the analyst substantially increasing both their earnings and revenue estimates.
See our latest analysis for Paradise Entertainment
It will come as no surprise to learn that the analyst has increased their price target for Paradise Entertainment 163% to HK$4.20 on the back of these upgrades.
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 Paradise Entertainment's rate of growth is expected to accelerate meaningfully, with the forecast 5.9% annualised revenue growth to the end of 2025 noticeably faster than its historical growth of 1.2% p.a. over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to grow their revenue at 11% per year. It seems obvious that, while the future growth outlook is brighter than the recent past, Paradise Entertainment is expected to grow slower than the wider industry.
The Bottom Line
The biggest takeaway for us from these new estimates is that the analyst upgraded their earnings per share estimates, with improved earnings power expected for this year. Fortunately, they also upgraded their revenue estimates, and are forecasting revenues to grow slower than the wider market. Given that the consensus looks almost universally bullish, with a substantial increase to forecasts and a higher price target, Paradise Entertainment could be worth investigating further.
Even so, the longer term trajectory of the business is much more important for the value creation of shareholders. At least one analyst has provided forecasts out to 2027, which can be seen for free on our platform here.
Another way to search for interesting companies that could be reaching an inflection point is to track whether management are buying or selling, with our free list of growing companies backed by insiders.
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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.