It's been a pretty great week for Everest Medicines Limited (HKG:1952) shareholders, with its shares surging 18% to HK$33.66 in the week since its latest half-yearly results. Revenues of CN¥1.1b arrived in line with expectations, although statutory losses per share were CN¥0.02, just a small fraction of what broker models predicted. 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. 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 current consensus from Everest Medicines' five analysts is for revenues of CN¥3.35b in 2026. This would reflect a huge 39% increase on its revenue over the past 12 months. Everest Medicines is also expected to turn profitable, with statutory earnings of CN¥1.91 per share. Yet prior to the latest earnings, the analysts had been anticipated revenues of CN¥3.30b and earnings per share (EPS) of CN¥0.63 in 2026. Although the revenue estimates have not really changed, we can see there's been a massive increase in earnings per share expectations, suggesting that the analysts have become more bullish after the latest result.
Check out our latest analysis for Everest Medicines
There's been no major changes to the consensus price target of HK$40.67, suggesting that the improved earnings per share outlook is not enough to have a long-term positive impact on the stock's valuation. 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. There are some variant perceptions on Everest Medicines, with the most bullish analyst valuing it at HK$69.45 and the most bearish at HK$25.73 per share. With such a wide range in price targets, analysts are almost certainly betting on widely divergent outcomes in the underlying business. With this in mind, we wouldn't rely too heavily the consensus price target, as it is just an average and analysts clearly have some deeply divergent views on the business.
Looking at the bigger picture now, one of the ways we can make sense of these forecasts is to see how they measure up against both past performance and industry growth estimates. It's clear from the latest estimates that Everest Medicines' rate of growth is expected to accelerate meaningfully, with the forecast 93% annualised revenue growth to the end of 2026 noticeably faster than its historical growth of 77% p.a. over the past five years. Compare this with other companies in the same industry, which are forecast to grow their revenue 22% annually. Factoring in the forecast acceleration in revenue, it's pretty clear that Everest Medicines 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 Everest Medicines following these results. Happily, there were no major changes to revenue forecasts, with the business still expected to grow faster than the wider industry. The consensus price target held steady at HK$40.67, 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 Everest Medicines. Long-term earnings power is much more important than next year's profits. We have estimates - from multiple Everest Medicines analysts - going out to 2028, and you can see them free on our platform here.
You should always think about risks though. Case in point, we've spotted 1 warning sign for Everest Medicines you should be aware of.
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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.