SAM Engineering & Equipment (M) Berhad (KLSE:SAM) Analysts Just Cut Their EPS Forecasts Substantially

Market forces rained on the parade of SAM Engineering & Equipment (M) Berhad (KLSE:SAM) shareholders today, when the analysts downgraded their 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.

Following the downgrade, the current consensus from SAM Engineering & Equipment (M) Berhad's three analysts is for revenues of RM1.6b in 2025 which - if met - would reflect a modest 3.5% increase on its sales over the past 12 months. Statutory earnings per share are forecast to be RM0.14, approximately in line with the last 12 months. Before this latest update, the analysts had been forecasting revenues of RM1.8b and earnings per share (EPS) of RM0.19 in 2025. Indeed, we can see that the analysts are a lot more bearish about SAM Engineering & Equipment (M) Berhad's prospects, administering a measurable cut to revenue estimates and slashing their EPS estimates to boot.

View our latest analysis for SAM Engineering & Equipment (M) Berhad

The consensus price target fell 11% to RM5.10, with the weaker earnings outlook clearly leading analyst valuation estimates.

Another way we can view these estimates is in the context of the bigger picture, such as how the forecasts stack up against past performance, and whether forecasts are more or less bullish relative to other companies in the industry. We would highlight that SAM Engineering & Equipment (M) Berhad's revenue growth is expected to slow, with the forecast 3.5% annualised growth rate until the end of 2025 being well below the historical 15% p.a. growth over the last five years. Compare this against other companies (with analyst forecasts) in the industry, which are in aggregate expected to see revenue growth of 15% annually. Factoring in the forecast slowdown in growth, it seems obvious that SAM Engineering & Equipment (M) 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 SAM Engineering & Equipment (M) Berhad. Unfortunately analysts also downgraded their revenue estimates, and industry data suggests that SAM Engineering & Equipment (M) Berhad's revenues are expected to grow slower than the wider market. After such a stark change in sentiment from analysts, we'd understand if readers now felt a bit wary of SAM Engineering & Equipment (M) Berhad.

With that said, the long-term trajectory of the company's earnings is a lot more important than next year. At Simply Wall St, we have a full range of analyst estimates for SAM Engineering & Equipment (M) Berhad going out to 2027, and you can see them free on our platform here.

Another way to search for interesting companies that could be reaching an inflection point is to track whether management are buying or selling, with our free list of growing companies backed by insiders.

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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.