Results: Golden Agri-Resources Ltd Exceeded Expectations And The Consensus Has Updated Its Estimates
It's been a good week for Golden Agri-Resources Ltd (SGX:E5H) shareholders, because the company has just released its latest full-year results, and the shares gained 7.7% to S$0.28. Results look mixed - while revenue fell marginally short of analyst estimates at US$11b, statutory earnings beat expectations 7.8%, with Golden Agri-Resources reporting profits of US$0.062 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. We thought readers would find it interesting to see the analysts latest (statutory) post-earnings forecasts for next year.
Check out our latest analysis for Golden Agri-Resources
After the latest results, the consensus from Golden Agri-Resources' five analysts is for revenues of US$10.1b in 2023, which would reflect a chunky 12% decline in sales compared to the last year of performance. Yet prior to the latest earnings, the analysts had been anticipated revenues of US$10.3b and earnings per share (EPS) of US$0.033 in 2023. Overall, while the analysts have reconfirmed their revenue estimates, the consensus now no longer provides an EPS estimate, suggesting that the market believes revenue is more important after these latest results.
There's been no real change to the consensus price target of S$0.32, with Golden Agri-Resources seemingly executing in line with expectations. 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$0.35 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. We would highlight that sales are expected to reverse, with a forecast 12% annualised revenue decline to the end of 2023. That is a notable change from historical growth of 11% 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 0.4% annually for the foreseeable future. It's pretty clear that Golden Agri-Resources' revenues are expected to perform substantially worse than the wider industry.
The Bottom Line
The clear take away from these updates is that the analysts made no change to their revenue estimates for next year, with the business apparently performing in line with their models. Fortunately, the analysts also reconfirmed their revenue estimates, suggesting sales are tracking in line with expectations - although our data does suggest that Golden Agri-Resources' revenues are expected to perform worse 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' five analysts has provided estimates out to 2025, which can be seen for free on our platform here.
You should always think about risks though. Case in point, we've spotted 2 warning signs for Golden Agri-Resources you should be aware of, and 1 of them makes us a bit uncomfortable.
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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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