Yahoo Finance Earnings Miss: Genting Malaysia Berhad Missed EPS By 20% And Analysts Are Revising Their Forecasts
Last week, you might have seen that Genting Malaysia Berhad (KLSE:GENM) released its annual result to the market. The early response was not positive, with shares down 3.1% to RM2.80 in the past week. It was not a great result overall. Although revenues beat expectations, hitting RM10b, statutory earnings missed analyst forecasts by 20%, coming in at just RM0.077 per share. 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. We thought readers would find it interesting to see the analysts latest (statutory) post-earnings forecasts for next year.
See our latest analysis for Genting Malaysia Berhad
Following the latest results, Genting Malaysia Berhad's twelve analysts are now forecasting revenues of RM10.9b in 2024. This would be an okay 7.2% improvement in revenue compared to the last 12 months. Per-share earnings are expected to surge 108% to RM0.16. In the lead-up to this report, the analysts had been modelling revenues of RM10.7b and earnings per share (EPS) of RM0.16 in 2024. There doesn't appear to have been a major change in sentiment following the results, other than the small lift in revenue estimates.
It may not be a surprise to see thatthe analysts have reconfirmed their price target of RM3.17, implying that the uplift in revenue is not expected to greatly contribute to Genting Malaysia Berhad's valuation in the near term. 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 Genting Malaysia Berhad at RM4.00 per share, while the most bearish prices it at RM2.55. This shows there is still a bit of diversity in estimates, but analysts don't appear to be totally split on the stock as though it might be a success or failure situation.
One way to get more context on these forecasts is to look at how they compare to both past performance, and how other companies in the same industry are performing. One thing stands out from these estimates, which is that Genting Malaysia Berhad is forecast to grow faster in the future than it has in the past, with revenues expected to display 7.2% annualised growth until the end of 2024. If achieved, this would be a much better result than the 2.8% annual decline over the past five years. Compare this against analyst estimates for the broader industry, which suggest that (in aggregate) industry revenues are expected to grow 4.1% annually. So it looks like Genting Malaysia Berhad is expected to grow faster than its competitors, at least for a while.
The Bottom Line
The most obvious conclusion is that there's been no major change in the business' prospects in recent times, with the analysts holding their earnings forecasts steady, in line with previous estimates. Pleasantly, they also upgraded their revenue estimates, and their forecasts suggest the business is expected to grow faster than the wider industry. There was no real change to the consensus price target, suggesting that the intrinsic value of the business has not undergone any major changes with the latest estimates.
With that in mind, we wouldn't be too quick to come to a conclusion on Genting Malaysia Berhad. Long-term earnings power is much more important than next year's profits. We have forecasts for Genting Malaysia Berhad going out to 2026, and you can see them free on our platform here.
You still need to take note of risks, for example - Genting Malaysia Berhad has 2 warning signs (and 1 which shouldn't be ignored) we think you should know about.
Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.
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.
