Downgrade: Here's How Analysts See HSS Engineers Berhad (KLSE:HSSEB) Performing In The Near Term

The analysts covering HSS Engineers Berhad (KLSE:HSSEB) delivered a dose of negativity to shareholders today, by making a substantial revision to their statutory forecasts for this year. Both revenue and earnings per share (EPS) forecasts went under the knife, suggesting the analysts have soured majorly on the business.

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Following this downgrade, HSS Engineers Berhad's three analysts are forecasting 2025 revenues to be RM219m, approximately in line with the last 12 months. Statutory earnings per share are anticipated to descend 16% to RM0.04 in the same period. Previously, the analysts had been modelling revenues of RM273m and earnings per share (EPS) of RM0.068 in 2025. Indeed, we can see that the analysts are a lot more bearish about HSS Engineers Berhad's prospects, administering a measurable cut to revenue estimates and slashing their EPS estimates to boot.

Check out our latest analysis for HSS Engineers Berhad

The consensus price target fell 23% to RM0.77, with the weaker earnings outlook clearly leading analyst valuation estimates.

Looking at the bigger picture now, one of the ways we can make sense of these forecasts is to see how they measure up against both past performance and industry growth estimates. It's pretty clear that there is an expectation that HSS Engineers Berhad's revenue growth will slow down substantially, with revenues to the end of 2025 expected to display 1.4% growth on an annualised basis. This is compared to a historical growth rate of 5.6% over the past five years. By way of comparison, the other companies in this industry with analyst coverage are forecast to grow their revenue at 16% per year. Factoring in the forecast slowdown in growth, it seems obvious that HSS Engineers Berhad is also expected to grow slower than other industry participants.

The Bottom Line

The biggest issue in the new estimates is that analysts have reduced their earnings per share estimates, suggesting business headwinds lay ahead for HSS Engineers Berhad. Regrettably, they also downgraded their revenue estimates, and the latest forecasts imply the business will grow sales slower than the wider market. Given the scope of the downgrades, it would not be a surprise to see the market become more wary of the business.

Even so, the longer term trajectory of the business is much more important for the value creation of shareholders. At Simply Wall St, we have a full range of analyst estimates for HSS Engineers Berhad going out to 2027, and you can see them 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.