It's been a pretty great week for Meituan Dianping (HKG:3690) shareholders, with its shares surging 10% to HK$139 in the week since its latest quarterly results. Overall the results were a little better than the analysts were expecting, with revenues beating forecasts by 4.6%to hit CN¥17b. This is an important time for investors, as they can track a company's performance in its report, look at what experts are forecasting for next year, and see if there has been any change to expectations for the business. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether the analysts have changed their mind on Meituan Dianping after the latest results.

View our latest analysis for Meituan Dianping

Taking into account the latest results, the most recent consensus for Meituan Dianping from 29 analysts is for revenues of CN¥110.5b in 2020 which, if met, would be a solid 17% increase on its sales over the past 12 months. Statutory earnings per share are expected to plunge 93% to CN¥0.024 in the same period. Before this earnings report, the analysts had been forecasting revenues of CN¥110.4b and earnings per share (EPS) of CN¥0.13 in 2020. So there's definitely been a decline in sentiment after the latest results, noting the large cut to new EPS forecasts.

Althoughthe analysts have revised their earnings forecasts for next year, they've also lifted the consensus price target 18% to CN¥127, suggesting the revised estimates are not indicative of a weaker long-term future for the business. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. Currently, the most bullish analyst values Meituan Dianping at CN¥156 per share, while the most bearish prices it at CN¥78.13. Note the wide gap in analyst price targets? This implies to us that there is a fairly broad range of possible scenarios for the underlying business.

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. It's pretty clear that there is an expectation that Meituan Dianping's revenue growth will slow down substantially, with revenues next year expected to grow 17%, compared to a historical growth rate of 29% over the past year. By way of comparison, the other companies in this industry with analyst coverage are forecast to grow their revenue at 24% per year. So it's pretty clear that, while revenue growth is expected to slow down, the wider industry is also expected to grow faster than Meituan Dianping.

The Bottom Line

The biggest concern is that the analysts reduced their earnings per share estimates, suggesting business headwinds could lay ahead for Meituan Dianping. On the plus side, there were no major changes to revenue estimates; although forecasts imply revenues will perform worse than the wider industry. We note an upgrade to the price target, suggesting that the analysts believes the intrinsic value of the business is likely to improve over time.

With that said, the long-term trajectory of the company's earnings is a lot more important than next year. We have estimates - from multiple Meituan Dianping analysts - going out to 2023, and you can see them free on our platform here.

And what about risks? Every company has them, and we've spotted 1 warning sign for Meituan Dianping you should know about.

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