Shareholders in GigaCloud Technology Inc. ( ) may be thrilled to learn that the analysts have just delivered a major upgrade to their near-term forecasts. The analysts greatly increased their revenue estimates, suggesting a stark improvement in business fundamentals. The stock price has risen 7.6% to US$11.54 over the past week, suggesting investors are becoming more optimistic. Whether the upgrade is enough to drive the stock price higher is yet to be seen, however.
Following the upgrade, the current consensus from GigaCloud Technology's dual analysts is for revenues of US$601m in 2023 which - if met - would reflect a solid 12% increase on its sales over the past 12 months. Per-share earnings are expected to bounce 63% to US$1.55. Previously, the analysts had been modelling revenues of US$545m and earnings per share (EPS) of US$1.19 in 2023. There has definitely been an improvement in perception recently, with the analysts substantially increasing both their earnings and revenue estimates.
With these upgrades, we're not surprised to see that the analysts have lifted their price target 7.7% to US$21.00 per share.
Of course, another way to look at these forecasts is to place them into context against the industry itself. The period to the end of 2023 brings more of the same, according to the analysts, with revenue forecast to display 17% growth on an annualised basis. That is in line with its 20% annual growth over the past year. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to see their revenues grow 4.9% per year. So it's pretty clear that GigaCloud Technology is forecast to grow substantially faster than its industry.
The biggest takeaway for us from these new estimates is that analysts upgraded their earnings per share estimates, with improved earnings power expected for this year. Fortunately, analysts also upgraded their revenue estimates, and our data indicates sales are expected to perform better than the wider market. Given that the consensus looks almost universally bullish, with a substantial increase to forecasts and a higher price target, GigaCloud Technology could be worth investigating further.
With that said, the long-term trajectory of the company's earnings is a lot more important than next year. We have analyst estimates for GigaCloud Technology going out as far as 2024, and you can see them free.
Of course, seeing company management invest large sums of money in a stock can be just as useful as knowing whether analysts are upgrading their estimates. So you may also wish to search this free.
What are the risks and opportunities for GigaCloud Technology?
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