Shareholders will be ecstatic, with their stake up 303% over the past week following Microvast Holdings, Inc.'s (NASDAQ:MVST) latest quarterly results. It looks like a credible result overall - although revenues of US$101m were what the analyst expected, Microvast Holdings surprised by delivering a statutory profit of US$0.03 per share, instead of the previously forecast loss. The analyst typically update their forecasts at each earnings report, and we can judge from their estimates whether their view of the company has changed or if there are any new concerns to be aware of. We thought readers would find it interesting to see the analyst latest (statutory) post-earnings forecasts for next year.

See our latest analysis for Microvast Holdings

Following the latest results, Microvast Holdings' one analyst are now forecasting revenues of US$475.0m in 2025. This would be a sizeable 28% improvement in revenue compared to the last 12 months. Losses are predicted to fall substantially, shrinking 86% to US$0.05. Yet prior to the latest earnings, the analyst had been forecasting revenues of US$582.8m and losses of US$0.20 per share in 2025. We can see there's definitely been a change in sentiment in this update, with the analyst administering a meaningful downgrade to next year's revenue estimates, while at the same time reducing their loss estimates.

The analyst has cut their price target 54% to US$4.00per share, suggesting that the declining revenue was a more crucial indicator than the forecast reduction in losses.

Of course, another way to look at these forecasts is to place them into context against the industry itself. We would highlight that Microvast Holdings' revenue growth is expected to slow, with the forecast 22% annualised growth rate until the end of 2025 being well below the historical 32% p.a. growth over the last five years. Juxtapose this against the other companies in the industry with analyst coverage, which are forecast to grow their revenues (in aggregate) 3.0% per year. Even after the forecast slowdown in growth, it seems obvious that Microvast Holdings is also expected to grow faster than the wider industry.

The Bottom Line

The most important thing to take away is that the analyst reconfirmed their loss per share estimates for next year. Regrettably, they also downgraded their revenue estimates, but the latest forecasts still imply the business will grow faster than the wider industry. Yet - earnings are more important to the intrinsic value of the business. The consensus price target fell measurably, with the analyst seemingly not reassured by the latest results, leading to a lower estimate of Microvast Holdings' future valuation.

Following on from that line of thought, we think that the long-term prospects of the business are much more relevant than next year's earnings. At least one analyst has provided forecasts out to 2025, which can be seen for free on our platform here.

We don't want to rain on the parade too much, but we did also find 4 warning signs for Microvast Holdings (2 are significant!) that you need to be mindful 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.