It’s shaping up to be a tough period for VinFast Auto Ltd. (NASDAQ:VFS), which a week ago released some disappointing full-year results that could have a notable impact on how the market views the stock. The numbers were fairly weak, with revenue of ₫29t missing analyst predictions by 9.0%, and (statutory) losses of ₫25,236 per share being slightly larger than what the analysts had expected. The analysts 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. So we collected the latest post-earnings statutory consensus estimates to see what could be in store for next year.
Check out our latest analysis for VinFast Auto
Taking into account the latest results, the most recent consensus for VinFast Auto from four analysts is for revenues of ₫67t in 2024. If met, it would imply a substantial 134% increase on its revenue over the past 12 months. Losses are supposed to decline, shrinking 14% from last year to ₫20,940. Yet prior to the latest earnings, the analysts had been forecasting revenues of ₫66t and losses of ₫21,679 per share in 2024. It looks like there’s been a modest increase in sentiment in the recent updates, with the analysts becoming a bit more optimistic in their predictions for losses per share, even though the revenue numbers were unchanged.
The average price target held steady at US$10.00, seeming to indicate that business is performing 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 VinFast Auto analyst has a price target of US$12.00 per share, while the most pessimistic values it at US$8.00. These price targets show that analysts do have some differing views on the business, but the estimates do not vary enough to suggest to us that some are betting on wild success or utter failure.
Of course, another way to look at these forecasts is to place them into context against the industry itself. It’s clear from the latest estimates that VinFast Auto’s rate of growth is expected to accelerate meaningfully, with the forecast 134% annualised revenue growth to the end of 2024 noticeably faster than its historical growth of 19% p.a. over the past three years. Compare this with other companies in the same industry, which are forecast to grow their revenue 14% annually. It seems obvious that, while the growth outlook is brighter than the recent past, the analysts also expect VinFast Auto to grow faster than the wider industry.
The Bottom Line
The most important thing to take away is that the analysts reconfirmed their loss per share estimates for next year. Fortunately, they also reconfirmed their revenue numbers, suggesting that it’s tracking in line with expectations. Additionally, our data suggests that revenue is expected to grow faster than the wider industry. The consensus price target held steady at US$10.00, 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 VinFast Auto. Long-term earnings power is much more important than next year’s profits. We have estimates – from multiple VinFast Auto analysts – going out to 2026, and you can see them free on our platform here.
Don’t forget that there may still be risks. For instance, we’ve identified 5 warning signs for VinFast Auto (3 are a bit unpleasant) 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.
