Top Glove Corporation Bhd. Beat Analyst Profit Forecasts, And Analysts Have New Estimates
Top Glove Corporation Bhd. (KLSE:TOPGLOV) last week reported its latest third-quarter results, which makes it a good time for investors to dive in and see if the business is performing in line with expectations. Although revenues of RM637m were in line with analyst expectations, Top Glove Corporation Bhd surprised on the earnings front, with an unexpected (statutory) profit of RM0.0063 per share a nice improvement on the losses that the analystsforecast. The analysts typically update their forecasts at each earnings report, and we can judge from their estimates whether their view of the company has changed or if there are any new concerns to be aware of. We thought readers would find it interesting to see the analysts latest (statutory) post-earnings forecasts for next year.
View our latest analysis for Top Glove Corporation Bhd
Following the latest results, Top Glove Corporation Bhd's 20 analysts are now forecasting revenues of RM4.12b in 2025. This would be a substantial 91% improvement in revenue compared to the last 12 months. Earnings are expected to improve, with Top Glove Corporation Bhd forecast to report a statutory profit of RM0.022 per share. Yet prior to the latest earnings, the analysts had been anticipated revenues of RM4.10b and earnings per share (EPS) of RM0.023 in 2025. So it looks like there's been a small decline in overall sentiment after the recent results - there's been no major change to revenue estimates, but the analysts did make a minor downgrade to their earnings per share forecasts.
Despite cutting their earnings forecasts,the analysts have lifted their price target 14% to RM0.98, suggesting that these impacts are not expected to weigh on the stock's value in the long 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 Top Glove Corporation Bhd at RM1.43 per share, while the most bearish prices it at RM0.60. Note the wide gap in analyst price targets? This implies to us that there is a fairly broad range of possible scenarios for the underlying business.
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. For example, we noticed that Top Glove Corporation Bhd's rate of growth is expected to accelerate meaningfully, with revenues forecast to exhibit 68% growth to the end of 2025 on an annualised basis. That is well above its historical decline of 15% a year over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in the industry are forecast to see their revenue grow 14% per year. Not only are Top Glove Corporation Bhd's revenues expected to improve, it seems that the analysts are also expecting it to grow faster than the wider industry.
The Bottom Line
The biggest concern is that the analysts reduced their earnings per share estimates, suggesting business headwinds could lay ahead for Top Glove Corporation Bhd. Fortunately, they also reconfirmed their revenue numbers, suggesting that it's tracking in line with expectations. Additionally, our data suggests that revenue is expected to grow faster 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 said, the long-term trajectory of the company's earnings is a lot more important than next year. At Simply Wall St, we have a full range of analyst estimates for Top Glove Corporation Bhd going out to 2026, and you can see them free on our platform here..
It is also worth noting that we have found 1 warning sign for Top Glove Corporation Bhd that you need to take into consideration.
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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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