Earnings Beat: Ranhill Utilities Berhad Just Beat Analyst Forecasts, And Analysts Have Been Updating Their Models
Ranhill Utilities Berhad (KLSE:RANHILL) shareholders are probably feeling a little disappointed, since its shares fell 4.5% to RM2.54 in the week after its latest yearly results. Revenues were RM2.5b, approximately in line with expectations, although statutory earnings per share (EPS) performed substantially better. EPS of RM0.15 were also better than expected, beating analyst predictions by 10%. 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.
Taking into account the latest results, the current consensus from Ranhill Utilities Berhad's five analysts is for revenues of RM2.68b in 2027. This would reflect a credible 7.7% increase on its revenue over the past 12 months. Per-share earnings are expected to increase 3.3% to RM0.16. Before this earnings report, the analysts had been forecasting revenues of RM2.65b and earnings per share (EPS) of RM0.15 in 2027. So the consensus seems to have become somewhat more optimistic on Ranhill Utilities Berhad's earnings potential following these results.
Check out our latest analysis for Ranhill Utilities Berhad
The consensus price target rose 19% to RM2.90, suggesting that higher earnings estimates flow through to the stock's valuation as well. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. The most optimistic Ranhill Utilities Berhad analyst has a price target of RM3.26 per share, while the most pessimistic values it at RM2.39. The narrow spread of estimates could suggest that the business' future is relatively easy to value, or thatthe analysts have a strong view on its prospects.
One way to get more context on these forecasts is to look at how they compare to both past performance, and how other companies in the same industry are performing. We would highlight that Ranhill Utilities Berhad's revenue growth is expected to slow, with the forecast 7.7% annualised growth rate until the end of 2027 being well below the historical 12% p.a. growth over the last five years. By way of comparison, the other companies in this industry with analyst coverage are forecast to grow their revenue at 4.4% annually. Even after the forecast slowdown in growth, it seems obvious that Ranhill Utilities Berhad is also expected to grow faster than 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 Ranhill Utilities Berhad's earnings potential next year. Happily, there were no major changes to revenue forecasts, with the business still expected to grow faster than the wider industry. We note an upgrade to the price target, suggesting that the analysts believes the intrinsic value of the business is likely to improve over time.
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. At Simply Wall St, we have a full range of analyst estimates for Ranhill Utilities Berhad going out to 2029, and you can see them free on our platform here..
You can also view our analysis of Ranhill Utilities Berhad's balance sheet, and whether we think Ranhill Utilities Berhad is carrying too much debt, for free on our platform here.
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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.