The Hong Leong Financial Group Berhad (KLSE:HLFG) Annual Results Are Out And Analysts Have Published New Forecasts

It's been a good week for Hong Leong Financial Group Berhad (KLSE:HLFG) shareholders, because the company has just released its latest full-year results, and the shares gained 2.0% to RM19.00. Hong Leong Financial Group Berhad reported RM7.5b in revenue, roughly in line with analyst forecasts, although statutory earnings per share (EPS) of RM3.03 beat expectations, being 4.0% higher than what the analysts expected. 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. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether the analysts have changed their mind on Hong Leong Financial Group Berhad after the latest results.

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After the latest results, the four analysts covering Hong Leong Financial Group Berhad are now predicting revenues of RM8.00b in 2027. If met, this would reflect an okay 6.4% improvement in revenue compared to the last 12 months. Statutory earnings per share are predicted to rise 4.5% to RM3.16. Before this earnings report, the analysts had been forecasting revenues of RM7.92b and earnings per share (EPS) of RM3.09 in 2027. So the consensus seems to have become somewhat more optimistic on Hong Leong Financial Group Berhad's earnings potential following these results.

See our latest analysis for Hong Leong Financial Group Berhad

The consensus price target was unchanged at RM25.81, implying that the improved earnings outlook is not expected to have a long term impact on value creation for shareholders. 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 Hong Leong Financial Group Berhad, with the most bullish analyst valuing it at RM33.00 and the most bearish at RM21.45 per share. As you can see, analysts are not all in agreement on the stock's future, but the range of estimates is still reasonably narrow, which could suggest that the outcome is not totally unpredictable.

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. We can infer from the latest estimates that forecasts expect a continuation of Hong Leong Financial Group Berhad'shistorical trends, as the 6.4% annualised revenue growth to the end of 2027 is roughly in line with the 5.7% annual growth over the past five years. Compare this with the broader industry, which analyst estimates (in aggregate) suggest will see revenues grow 6.1% annually. So although Hong Leong Financial Group Berhad is expected to maintain its revenue growth rate, it's only growing at about the rate of the wider industry.

The Bottom Line

The biggest takeaway for us is the consensus earnings per share upgrade, which suggests a clear improvement in sentiment around Hong Leong Financial Group Berhad's earnings potential next year. They also reconfirmed their revenue estimates, with the company predicted to grow at about the same rate as the wider industry. The consensus price target held steady at RM25.81, with the latest estimates not enough to have an impact on their price targets.

Following on from that line of thought, we think that the long-term prospects of the business are much more relevant than next year's earnings. We have estimates - from multiple Hong Leong Financial Group Berhad analysts - going out to 2029, and you can see them free on our platform here.

You can also see our analysis of Hong Leong Financial Group Berhad's Board and CEO remuneration and experience, and whether company insiders have been buying stock.

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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.