Earnings Miss: PETRONAS Gas Berhad Missed EPS By 7.3% And Analysts Are Revising Their Forecasts
The annual results for PETRONAS Gas Berhad (KLSE:PETGAS) were released last week, making it a good time to revisit its performance. It was a pretty mixed result, with revenues beating expectations to hit RM6.2b. Statutory earnings fell 7.3% short of analyst forecasts, reaching RM0.83 per share. 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.
Check out our latest analysis for PETRONAS Gas Berhad
After the latest results, the consensus from PETRONAS Gas Berhad's twelve analysts is for revenues of RM5.85b in 2023, which would reflect a discernible 5.0% decline in sales compared to the last year of performance. Statutory earnings per share are predicted to ascend 16% to RM0.96. Yet prior to the latest earnings, the analysts had been anticipated revenues of RM5.75b and earnings per share (EPS) of RM0.96 in 2023. 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.
There were no changes to revenue or earnings estimates or the price target of RM18.06, suggesting that the company has met expectations in its recent result. 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. There are some variant perceptions on PETRONAS Gas Berhad, with the most bullish analyst valuing it at RM20.60 and the most bearish at RM16.40 per share. This is a very narrow spread of estimates, implying either that PETRONAS Gas Berhad is an easy company to value, or - more likely - the analysts are relying heavily on some key assumptions.
These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the PETRONAS Gas Berhad's past performance and to peers in the same industry. We would highlight that sales are expected to reverse, with a forecast 5.0% annualised revenue decline to the end of 2023. That is a notable change from historical growth of 2.8% over the last five years. By contrast, our data suggests that other companies (with analyst coverage) in the same industry are forecast to see their revenue grow 4.7% annually for the foreseeable future. So although its revenues are forecast to shrink, this cloud does not come with a silver lining - PETRONAS Gas Berhad is expected to lag the wider industry.
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 revenues will perform worse than the wider industry. The consensus price target held steady at RM18.06, with the latest estimates not enough to have an impact on their price targets.
With that said, the long-term trajectory of the company's earnings is a lot more important than next year. We have forecasts for PETRONAS Gas Berhad going out to 2025, and you can see them free on our platform here.
Don't forget that there may still be risks. For instance, we've identified 1 warning sign for PETRONAS Gas Berhad that you should be aware of.
Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.
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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