Yahoo Finance Revenue Beat: Scientex Berhad Exceeded Revenue Forecasts By 7.4% And Analysts Are Updating Their Estimates
Scientex Berhad (KLSE:SCIENTX) came out with its first-quarter results last week, and we wanted to see how the business is performing and what industry forecasters think of the company following this report. Results overall were respectable, with statutory earnings of RM0.28 per share roughly in line with what the analysts had forecast. Revenues of RM1.1b came in 7.4% ahead of analyst predictions. 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've gathered the most recent statutory forecasts to see whether the analysts have changed their earnings models, following these results.
See our latest analysis for Scientex Berhad
Taking into account the latest results, the most recent consensus for Scientex Berhad from seven analysts is for revenues of RM4.51b in 2024. If met, it would imply an okay 3.0% increase on its revenue over the past 12 months. Per-share earnings are expected to rise 4.8% to RM0.35. In the lead-up to this report, the analysts had been modelling revenues of RM4.54b and earnings per share (EPS) of RM0.36 in 2024. The consensus analysts don't seem to have seen anything in these results that would have changed their view on the business, given there's been no major change to their estimates.
The consensus price target rose 8.3% to RM4.51despite there being no meaningful change to earnings estimates. It could be that the analystsare reflecting the predictability of Scientex Berhad's earnings by assigning a price premium. There's another way to think about price targets though, and that's to look at the range of price targets put forward by analysts, because a wide range of estimates could suggest a diverse view on possible outcomes for the business. Currently, the most bullish analyst values Scientex Berhad at RM5.41 per share, while the most bearish prices it at RM4.00. 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.
Of course, another way to look at these forecasts is to place them into context against the industry itself. It's pretty clear that there is an expectation that Scientex Berhad's revenue growth will slow down substantially, with revenues to the end of 2024 expected to display 4.1% growth on an annualised basis. This is compared to a historical growth rate of 6.0% over the past five years. Compare this against other companies (with analyst forecasts) in the industry, which are in aggregate expected to see revenue growth of 6.6% annually. Factoring in the forecast slowdown in growth, it seems obvious that Scientex Berhad is also expected to grow slower than other industry participants.
The Bottom Line
The most important thing to take away is that there's been no major change in sentiment, with the analysts reconfirming that the business is performing in line with their previous earnings per share estimates. On the plus side, there were no major changes to revenue estimates; although forecasts imply they 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 in mind, we wouldn't be too quick to come to a conclusion on Scientex Berhad. Long-term earnings power is much more important than next year's profits. We have estimates - from multiple Scientex Berhad analysts - going out to 2026, and you can see them free on our platform here.
Plus, you should also learn about the 1 warning sign we've spotted with Scientex Berhad .
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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.
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