Hong Kong Exchanges and Clearing Limited (HKG:388) just released its quarterly report and things are looking bullish. Hong Kong Exchanges and Clearing beat earnings, with revenues hitting HK$8.2b, ahead of expectations, and statutory earnings per share outperforming analyst reckonings by a solid 14%. 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 collected the latest post-earnings statutory consensus estimates to see what could be in store for next year.

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Taking into account the latest results, the most recent consensus for Hong Kong Exchanges and Clearing from 18 analysts is for revenues of HK$31.0b in 2026. If met, it would imply a reasonable 2.8% increase on its revenue over the past 12 months. Statutory per share are forecast to be HK$15.03, approximately in line with the last 12 months. In the lead-up to this report, the analysts had been modelling revenues of HK$30.1b and earnings per share (EPS) of HK$14.58 in 2026. So there seems to have been a moderate uplift in sentiment following the latest results, given the upgrades to both revenue and earnings per share forecasts for next year.

Check out our latest analysis for Hong Kong Exchanges and Clearing

Althoughthe analysts have upgraded their earnings estimates, there was no change to the consensus price target of HK$518, suggesting that the forecast performance does not have a long term impact on the company’s valuation. 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. Currently, the most bullish analyst values Hong Kong Exchanges and Clearing at HK$610 per share, while the most bearish prices it at HK$400. As you can see, analysts are not all in agreement on the stock’s future, but the range of estimates is still reasonably narrow, which could suggest that the outcome is not totally unpredictable.

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Hong Kong Exchanges and Clearing’s past performance and to peers in the same industry. We would highlight that Hong Kong Exchanges and Clearing’s revenue growth is expected to slow, with the forecast 3.8% annualised growth rate until the end of 2026 being well below the historical 7.5% p.a. growth over the last five years. By way of comparison, the other companies in this industry with analyst coverage are forecast to grow their revenue at 8.3% per year. Factoring in the forecast slowdown in growth, it seems obvious that Hong Kong Exchanges and Clearing is also expected to grow slower than other industry participants.

The Bottom Line

The biggest takeaway for us is the consensus earnings per share upgrade, which suggests a clear improvement in sentiment around Hong Kong Exchanges and Clearing’s earnings potential next year. They also upgraded their revenue estimates for next year, even though it is expected to grow slower than the wider industry. The consensus price target held steady at HK$518, with the latest estimates not enough to have an impact on their price targets.

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. We have estimates – from multiple Hong Kong Exchanges and Clearing analysts – going out to 2028, 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 Hong Kong Exchanges and Clearing you should know about.

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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.