Domain Holdings Australia Limited (ASX:DHG) Yearly Results Just Came Out: Here's What Analysts Are Forecasting For This Year

By
Simply Wall St
Published
August 18, 2021
ASX:DHG
Source: Shutterstock

Shareholders of Domain Holdings Australia Limited (ASX:DHG) will be pleased this week, given that the stock price is up 12% to AU$5.19 following its latest full-year results. The result was positive overall - although revenues of AU$289m were in line with what the analysts predicted, Domain Holdings Australia surprised by delivering a statutory profit of AU$0.059 per share, modestly greater than expected. 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. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether the analysts have changed their mind on Domain Holdings Australia after the latest results.

See our latest analysis for Domain Holdings Australia

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ASX:DHG Earnings and Revenue Growth August 18th 2021

Taking into account the latest results, the current consensus from Domain Holdings Australia's eleven analysts is for revenues of AU$330.2m in 2022, which would reflect a solid 14% increase on its sales over the past 12 months. Statutory earnings per share are predicted to soar 41% to AU$0.083. Yet prior to the latest earnings, the analysts had been anticipated revenues of AU$331.9m and earnings per share (EPS) of AU$0.082 in 2022. 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 AU$5.14, suggesting that the company has met expectations in its recent result. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. Currently, the most bullish analyst values Domain Holdings Australia at AU$5.70 per share, while the most bearish prices it at AU$3.80. 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.

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. One thing stands out from these estimates, which is that Domain Holdings Australia is forecast to grow faster in the future than it has in the past, with revenues expected to display 14% annualised growth until the end of 2022. If achieved, this would be a much better result than the 7.6% annual decline over the past three years. Compare this against analyst estimates for the broader industry, which suggest that (in aggregate) industry revenues are expected to grow 6.5% annually. So it looks like Domain Holdings Australia is expected to grow faster than its competitors, at least for a while.

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. Fortunately, they also reconfirmed their revenue numbers, suggesting sales are tracking in line with expectations - and our data suggests that revenues are expected to grow faster than the wider industry. There was no real change to the consensus price target, suggesting that the intrinsic value of the business has not undergone any major changes with the latest estimates.

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 Domain Holdings Australia analysts - going out to 2024, and you can see them free on our platform here.

You can also see whether Domain Holdings Australia is carrying too much debt, and whether its balance sheet is healthy, for free on our platform here.

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