Xiaomi Corporation (HKG:1810) Analysts Are Cutting Their Estimates: Here's What You Need To Know

There's been a notable change in appetite for Xiaomi Corporation (HKG:1810) shares in the week since its yearly report, with the stock down 11% to HK$32.44. Results were roughly in line with estimates, with revenues of CN¥457b and statutory earnings per share of CN¥1.56. 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. With this in mind, we've gathered the latest statutory forecasts to see what the analysts are expecting for next year.

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After the latest results, the 36 analysts covering Xiaomi are now predicting revenues of CN¥500.4b in 2026. If met, this would reflect a meaningful 9.4% improvement in revenue compared to the last 12 months. Statutory earnings per share are expected to nosedive 30% to CN¥1.13 in the same period. Yet prior to the latest earnings, the analysts had been anticipated revenues of CN¥544.6b and earnings per share (EPS) of CN¥1.56 in 2026. From this we can that sentiment has definitely become more bearish after the latest results, leading to lower revenue forecasts and a large cut to earnings per share estimates.

Check out our latest analysis for Xiaomi

The consensus price target fell 6.7% to HK$44.61, with the weaker earnings outlook clearly leading valuation estimates. 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 Xiaomi analyst has a price target of HK$80.31 per share, while the most pessimistic values it at HK$27.00. With such a wide range in price targets, analysts are almost certainly betting on widely divergent outcomes in the underlying business. As a result it might not be a great idea to make decisions based on the consensus price target, which is after all just an average of this wide range of estimates.

Of course, another way to look at these forecasts is to place them into context against the industry itself. The period to the end of 2026 brings more of the same, according to the analysts, with revenue forecast to display 9.4% growth on an annualised basis. That is in line with its 8.8% annual growth over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to see their revenues grow 16% per year. So although Xiaomi is expected to maintain its revenue growth rate, it's forecast to grow slower than the wider industry.

The Bottom Line

The most important thing to take away is that the analysts downgraded their earnings per share estimates, showing that there has been a clear decline in sentiment following these results. On the negative side, they also downgraded their revenue estimates, and forecasts imply they will perform worse than the wider industry. Furthermore, the analysts also cut their price targets, suggesting that the latest news has led to greater pessimism about the intrinsic value of the business.

Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. We have estimates - from multiple Xiaomi analysts - going out to 2028, and you can see them free on our platform here.

We don't want to rain on the parade too much, but we did also find 1 warning sign for Xiaomi 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.