Need To Know: Analysts Just Made A Substantial Cut To Their P.I.E. Industrial Berhad (KLSE:PIE) Estimates

Market forces rained on the parade of P.I.E. Industrial Berhad (KLSE:PIE) shareholders today, when the analysts downgraded their forecasts for this year. Both revenue and earnings per share (EPS) estimates were cut sharply as the analysts factored in the latest outlook for the business, concluding that they were too optimistic previously.

Following the downgrade, the latest consensus from P.I.E. Industrial Berhad's two analysts is for revenues of RM1.2b in 2024, which would reflect a solid 11% improvement in sales compared to the last 12 months. Statutory earnings per share are presumed to increase 6.9% to RM0.21. Previously, the analysts had been modelling revenues of RM1.3b and earnings per share (EPS) of RM0.23 in 2024. It looks like analyst sentiment has declined substantially, with a measurable cut to revenue estimates and a considerable drop in earnings per share numbers as well.

Check out our latest analysis for P.I.E. Industrial Berhad

Analysts made no major changes to their price target of RM6.70, suggesting the downgrades are not expected to have a long-term impact on P.I.E. Industrial Berhad's valuation.

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. It's pretty clear that there is an expectation that P.I.E. Industrial Berhad's revenue growth will slow down substantially, with revenues to the end of 2024 expected to display 11% growth on an annualised basis. This is compared to a historical growth rate of 15% over the past five years. Compare this against other companies (with analyst forecasts) in the industry, which are in aggregate expected to see revenue growth of 29% annually. So it's pretty clear that, while revenue growth is expected to slow down, the wider industry is also expected to grow faster than P.I.E. Industrial Berhad.

The Bottom Line

The most important thing to take away is that analysts cut their earnings per share estimates, expecting a clear decline in business conditions. Unfortunately analysts also downgraded their revenue estimates, and industry data suggests that P.I.E. Industrial Berhad's revenues are expected to grow slower than the wider market. The lack of change in the price target is puzzling in light of the downgrade but, with a serious decline expected this year, we wouldn't be surprised if investors were a bit wary of P.I.E. Industrial Berhad.

With that said, the long-term trajectory of the company's earnings is a lot more important than next year. At least one analyst has provided forecasts out to 2026, which can be seen for 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 downgrading their estimates. So you may also wish to search this free list of stocks with high insider ownership.

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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.