Shareholders might have noticed that Hutchison Port Holdings Trust (SGX:NS8U) filed its full-year result this time last week. The early response was not positive, with shares down 3.3% to US$0.14 in the past week. Statutory earnings per share fell badly short of expectations, coming in at HK$0.027, some 52% below analyst forecasts, although revenues were okay, approximately in line with analyst estimates at HK$11b. 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.
Following last week's earnings report, Hutchison Port Holdings Trust's two analysts are forecasting 2024 revenues to be HK$10.7b, approximately in line with the last 12 months. Per-share earnings are expected to bounce 161% to HK$0.07. Before this earnings report, the analysts had been forecasting revenues of HK$11.0b and earnings per share (EPS) of HK$0.08 in 2024. The analysts seem less optimistic after the recent results, reducing their revenue forecasts and making a real cut to earnings per share numbers.
It'll come as no surprise then, to learn that the analysts have cut their price target 7.4% to US$0.20.
Another way we can view these estimates is in the context of the bigger picture, such as how the forecasts stack up against past performance, and whether forecasts are more or less bullish relative to other companies in the industry. We can infer from the latest estimates that forecasts expect a continuation of Hutchison Port Holdings Trust'shistorical trends, as the 1.1% annualised revenue growth to the end of 2024 is roughly in line with the 1.2% annual growth over the past five years. Compare this with the broader industry (in aggregate), which analyst estimates suggest will see revenues grow 10% annually. So it's pretty clear that Hutchison Port Holdings Trust is expected to grow slower than similar companies in the same 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. Unfortunately, they also downgraded their revenue estimates, and our data indicates underperformance compared to the wider industry. Even so, earnings per share are more important to the intrinsic value of the business. 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.
With that in mind, we wouldn't be too quick to come to a conclusion on Hutchison Port Holdings Trust. Long-term earnings power is much more important than next year's profits. At least one analyst has provided forecasts out to 2026, which can be seen for free on our platform here.
And what about risks? Every company has them, and we've spotted 3 warning signs for Hutchison Port Holdings Trust (of which 1 is concerning!) 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.