Galaxy Entertainment Group Limited (HKG:27) shareholders are probably feeling a little disappointed, since its shares fell 8.5% to HK$27.60 in the week after its latest full-year results. Revenues of HK$43b were in line with forecasts, although statutory earnings per share (EPS) came in below expectations at HK$2.00, missing estimates by 4.9%. Following the result, the analysts have updated their earnings model, and it would be good to know whether they think there's been a strong change in the company's prospects, or if it's business as usual. So we gathered the latest post-earnings forecasts to see what estimates suggest is in store for next year.

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Following the latest results, Galaxy Entertainment Group's 16 analysts are now forecasting revenues of HK$46.9b in 2025. This would be a modest 7.8% improvement in revenue compared to the last 12 months. Per-share earnings are expected to step up 13% to HK$2.26. Yet prior to the latest earnings, the analysts had been anticipated revenues of HK$47.0b and earnings per share (EPS) of HK$2.26 in 2025. So it's pretty clear that, although the analysts have updated their estimates, there's been no major change in expectations for the business following the latest results.

See our latest analysis for Galaxy Entertainment Group

The analysts reconfirmed their price target of HK$44.44, showing that the business is executing well and in line with expectations. 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. The most optimistic Galaxy Entertainment Group analyst has a price target of HK$55.00 per share, while the most pessimistic values it at HK$34.00. Analysts definitely have varying views on the business, but the spread of estimates is not wide enough in our view to suggest that extreme outcomes could await Galaxy Entertainment Group shareholders.

Taking a look at the bigger picture now, one of the ways we can understand these forecasts is to see how they compare to both past performance and industry growth estimates. The analysts are definitely expecting Galaxy Entertainment Group's growth to accelerate, with the forecast 7.8% annualised growth to the end of 2025 ranking favourably alongside historical growth of 5.9% per annum over the past five years. Compare this with other companies in the same industry, which are forecast to see revenue growth of 11% annually. So it's clear that despite the acceleration in growth, Galaxy Entertainment Group is expected to grow meaningfully slower than the industry average.

The Bottom Line

The most important thing to take away is that there's been no major change in sentiment, with the analysts reconfirming that the business is performing in line with their previous earnings per share estimates. On the plus side, there were no major changes to revenue estimates; although forecasts imply they will perform worse 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.

With that in mind, we wouldn't be too quick to come to a conclusion on Galaxy Entertainment Group. Long-term earnings power is much more important than next year's profits. We have forecasts for Galaxy Entertainment Group going out to 2027, and you can see them free on our platform here.

You should always think about risks though. Case in point, we've spotted 2 warning signs for Galaxy Entertainment Group you should be aware of.

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