Analysts Have Lowered Expectations For Media Prima Berhad (KLSE:MEDIA) After Its Latest Results
Last week, you might have seen that Media Prima Berhad (KLSE:MEDIA) released its full-year result to the market. The early response was not positive, with shares down 3.3% to RM0.29 in the past week. Revenues came in 4.4% below expectations, at RM780m. Statutory earnings per share were relatively better off, with a per-share profit of RM0.014 being roughly in line with analyst estimates. 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. So we gathered the latest post-earnings forecasts to see what estimates suggest is in store for next year.
After the latest results, the consensus from Media Prima Berhad's four analysts is for revenues of RM749.4m in 2027, which would reflect a measurable 3.9% decline in revenue compared to the last year of performance. Statutory earnings per share are expected to sink 18% to RM0.011 in the same period. Before this earnings report, the analysts had been forecasting revenues of RM805.5m and earnings per share (EPS) of RM0.016 in 2027. From this we can that sentiment has definitely become more bearish after the latest results, leading to lower revenue forecasts and a pretty serious reduction to earnings per share estimates.
View our latest analysis for Media Prima Berhad
It'll come as no surprise then, to learn that the analysts have cut their price target 6.9% to RM0.30. That's not the only conclusion we can draw from this data however, as some investors also like to consider the spread in estimates when evaluating analyst price targets. Currently, the most bullish analyst values Media Prima Berhad at RM0.33 per share, while the most bearish prices it at RM0.28. This is a very narrow spread of estimates, implying either that Media Prima Berhad is an easy company to value, or - more likely - the analysts are relying heavily on some key assumptions.
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 would also point out that the forecast 3.9% annualised revenue decline to the end of 2027 is better than the historical trend, which saw revenues shrink 7.3% annually over the past five years Compare this against analyst estimates for companies in the broader industry, which suggest that revenues (in aggregate) are expected to grow 8.1% annually. So while a broad number of companies are forecast to grow, unfortunately Media Prima Berhad is expected to see its revenue affected worse than other companies in the industry.
The Bottom Line
The most important thing to take away is that the analysts downgraded their earnings per share estimates, showing that there has been a clear decline in sentiment following these results. Unfortunately, they also downgraded their revenue estimates, and our data indicates underperformance compared to the wider industry. Even so, earnings per share are more important to the intrinsic value of the business. The consensus price target fell measurably, with the analysts seemingly not reassured by the latest results, leading to a lower estimate of Media Prima Berhad's future valuation.
With that in mind, we wouldn't be too quick to come to a conclusion on Media Prima Berhad. Long-term earnings power is much more important than next year's profits. At Simply Wall St, we have a full range of analyst estimates for Media Prima Berhad going out to 2029, and you can see them free on our platform here..
Plus, you should also learn about the 3 warning signs we've spotted with Media Prima Berhad (including 1 which doesn't sit too well with us) .
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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.