FIT Hon Teng Limited Earnings Missed Analyst Estimates: Here's What Analysts Are Forecasting Now

FIT Hon Teng Limited (HKG:6088) missed earnings with its latest interim results, disappointing overly-optimistic forecasters. Results showed a clear earnings miss, with US$2.3b revenue coming in 6.5% lower than what the analystsexpected. Statutory earnings per share (EPS) of US$0.0044 missed the mark badly, arriving some 56% below what was expected. Earnings are an important time for investors, as they can track a company's performance, look at what the analysts are forecasting for next year, and see if there's been a change in sentiment towards the company. We thought readers would find it interesting to see the analysts latest (statutory) post-earnings forecasts for next year.

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Following the latest results, FIT Hon Teng's seven analysts are now forecasting revenues of US$4.83b in 2025. This would be a modest 3.0% improvement in revenue compared to the last 12 months. Statutory earnings per share are predicted to swell 16% to US$0.025. Yet prior to the latest earnings, the analysts had been anticipated revenues of US$5.12b and earnings per share (EPS) of US$0.029 in 2025. The analysts seem less optimistic after the recent results, reducing their revenue forecasts and making a real cut to earnings per share numbers.

View our latest analysis for FIT Hon Teng

The average price target climbed 11% to HK$3.54despite the reduced earnings forecasts, suggesting that this earnings impact could be a positive for the stock, once it passes. 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 FIT Hon Teng, with the most bullish analyst valuing it at HK$4.95 and the most bearish at HK$2.66 per share. So we wouldn't be assigning too much credibility to analyst price targets in this case, because there are clearly some widely different views on what kind of performance this business can generate. With this in mind, we wouldn't rely too heavily the consensus price target, as it is just an average and analysts clearly have some deeply divergent views on the business.

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the FIT Hon Teng's past performance and to peers in the same industry. The analysts are definitely expecting FIT Hon Teng's growth to accelerate, with the forecast 6.0% annualised growth to the end of 2025 ranking favourably alongside historical growth of 0.5% per annum over the past five years. Compare this with other companies in the same industry, which are forecast to see revenue growth of 12% annually. So it's clear that despite the acceleration in growth, FIT Hon Teng is expected to grow meaningfully slower than the industry average.

The Bottom Line

The biggest concern is that the analysts reduced their earnings per share estimates, suggesting business headwinds could lay ahead for FIT Hon Teng. On the negative side, they also downgraded their revenue estimates, and forecasts imply they will perform worse 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.

Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. We have forecasts for FIT Hon Teng going out to 2027, and you can see them free on our platform here.

Don't forget that there may still be risks. For instance, we've identified 2 warning signs for FIT Hon Teng that you should be aware of.

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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.