Yahoo Finance Results: Frencken Group Limited Exceeded Expectations And The Consensus Has Updated Its Estimates
Frencken Group Limited (SGX:E28) defied analyst predictions to release its full-year results, which were ahead of market expectations. The company beat forecasts, with revenue of S$743m, some 3.2% above estimates, and statutory earnings per share (EPS) coming in at S$0.076, 27% ahead of expectations. 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. With this in mind, we've gathered the latest statutory forecasts to see what the analysts are expecting for next year.
View our latest analysis for Frencken Group
Taking into account the latest results, the consensus forecast from Frencken Group's five analysts is for revenues of S$822.1m in 2024. This reflects a solid 11% improvement in revenue compared to the last 12 months. Per-share earnings are expected to soar 41% to S$0.11. In the lead-up to this report, the analysts had been modelling revenues of S$794.9m and earnings per share (EPS) of S$0.10 in 2024. 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.
It will come as no surprise to learn that the analysts have increased their price target for Frencken Group 20% to S$1.78on the back of these upgrades. 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 Frencken Group at S$1.90 per share, while the most bearish prices it at S$1.70. This is a very narrow spread of estimates, implying either that Frencken Group is an easy company to value, or - more likely - the analysts are relying heavily on some key assumptions.
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 clear from the latest estimates that Frencken Group's rate of growth is expected to accelerate meaningfully, with the forecast 11% annualised revenue growth to the end of 2024 noticeably faster than its historical growth of 4.7% p.a. over the past five years. Other similar companies in the industry (with analyst coverage) are also forecast to grow their revenue at 11% per year. Frencken Group is expected to grow at about the same rate as its industry, so it's not clear that we can draw any conclusions from its growth relative to competitors.
The Bottom Line
The biggest takeaway for us is the consensus earnings per share upgrade, which suggests a clear improvement in sentiment around Frencken Group's earnings potential next year. There was also an upgrade to revenue estimates, although as we saw earlier, forecast growth is only expected to be about the same as the wider industry. There was also a nice increase in the price target, with the analysts clearly feeling that the intrinsic value of the business is improving.
With that in mind, we wouldn't be too quick to come to a conclusion on Frencken Group. Long-term earnings power is much more important than next year's profits. At Simply Wall St, we have a full range of analyst estimates for Frencken Group going out to 2026, and you can see them free on our platform here..
Even so, be aware that Frencken Group is showing 1 warning sign in our investment analysis , 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.
