AME Elite Consortium Berhad (KLSE:AME) shareholders will have a reason to smile today, with the analysts making substantial upgrades to this year's statutory forecasts. The analysts have sharply increased their revenue numbers, with a view that AME Elite Consortium Berhad will make substantially more sales than they'd previously expected. The market may be pricing in some blue sky too, with the share price gaining 11% to RM2.40 in the last 7 days. We'll be curious to see if these new estimates convince the market to lift the stock price higher still.
Following this upgrade, AME Elite Consortium Berhad's dual analysts are forecasting 2021 revenues to be RM461m, approximately in line with the last 12 months. Before the latest update, the analysts were foreseeing RM397m of revenue in 2021. The consensus has definitely become more optimistic, showing a substantial gain in revenue forecasts.
Additionally, the consensus price target for AME Elite Consortium Berhad increased 7.8% to RM2.64, showing a clear increase in optimism from the analysts involved. The consensus price target is just an average of individual analyst targets, so - it could be handy to see how wide the range of underlying estimates is. The most optimistic AME Elite Consortium Berhad analyst has a price target of RM2.60 per share, while the most pessimistic values it at RM2.53. Even so, with a relatively close grouping of estimates, it looks like the analysts are quite confident in their valuations, suggesting AME Elite Consortium Berhad is an easy business to forecast or the underlying assumptions are obvious.
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. These estimates imply that sales are expected to slow, with a forecast annualised revenue decline of 0.002% by the end of 2021. This indicates a significant reduction from annual growth of 8.4% over the last five years. By contrast, our data suggests that other companies (with analyst coverage) in the same industry are forecast to see their revenue grow 12% annually for the foreseeable future. It's pretty clear that AME Elite Consortium Berhad's revenues are expected to perform substantially worse than the wider industry.
The Bottom Line
The most important thing to take away from this upgrade is that analysts lifted their revenue estimates for this year. They're also anticipating slower revenue growth than the wider market. There was also an increase in the price target, suggesting that there is more optimism baked into the forecasts than there was previously. Seeing the dramatic upgrade to this year's forecasts, it might be time to take another look at AME Elite Consortium Berhad.
Looking to learn more? We have analyst estimates for AME Elite Consortium Berhad going out to 2023, and you can see them free on our platform here.
Of course, seeing company management invest large sums of money in a stock can be just as useful as knowing whether analysts are upgrading their estimates. So you may also wish to search this free list of stocks that insiders are buying.
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