It's shaping up to be a tough period for Golden Agri-Resources Ltd (SGX:E5H), which a week ago released some disappointing annual results that could have a notable impact on how the market views the stock. Results showed a clear earnings miss, with US$9.8b revenue coming in 3.3% lower than what the analystsexpected. Statutory earnings per share (EPS) of US$0.016 missed the mark badly, arriving some 65% below what was expected. 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. So we gathered the latest post-earnings forecasts to see what estimates suggest is in store for next year.
Taking into account the latest results, the current consensus from Golden Agri-Resources' three analysts is for revenues of US$10.5b in 2024. This would reflect a solid 8.1% increase on its revenue over the past 12 months. In the lead-up to this report, the analysts had been modelling revenues of US$10.7b and earnings per share (EPS) of US$0.048 in 2024. Overall, while the analysts have reconfirmed their revenue estimates, the consensus now no longer provides an EPS estimate. This implies that the market believes revenue is more important after these latest results.
We'd also point out that thatthe analysts have made no major changes to their price target of S$0.32. 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 Golden Agri-Resources at S$0.40 per share, while the most bearish prices it at S$0.27. 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 Golden Agri-Resources' revenue growth will slow down substantially, with revenues to the end of 2024 expected to display 8.1% growth on an annualised basis. This is compared to a historical growth rate of 13% over the past five years. By way of comparison, the other companies in this industry with analyst coverage are forecast to grow their revenue at 2.9% annually. Even after the forecast slowdown in growth, it seems obvious that Golden Agri-Resources is also expected to grow faster than the wider industry.
The Bottom Line
The most important thing to take away is that the analysts reconfirmed their revenue estimates for next year, suggesting that the business is performing in line with expectations. 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. The consensus price target held steady at S$0.32, with the latest estimates not enough to have an impact on their price targets.
At least one of Golden Agri-Resources' three analysts has provided estimates out to 2026, which can be seen for free on our platform here.
Before you take the next step you should know about the 2 warning signs for Golden Agri-Resources that we have uncovered.
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