Power Root Berhad Earnings Missed Analyst Estimates: Here's What Analysts Are Forecasting Now

As you might know, Power Root Berhad (KLSE:PWROOT) recently reported its full-year numbers. Revenues of RM422m were in line with forecasts, although statutory earnings per share (EPS) came in below expectations at RM0.071, missing estimates by 8.1%. 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.

AI is about to change healthcare. These 20 stocks are working on everything from early diagnostics to drug discovery. The best part - they are all under $10bn in marketcap - there is still time to get in early.

Taking into account the latest results, the current consensus from Power Root Berhad's four analysts is for revenues of RM435.0m in 2026. This would reflect an okay 3.2% increase on its revenue over the past 12 months. Per-share earnings are expected to expand 14% to RM0.086. Yet prior to the latest earnings, the analysts had been anticipated revenues of RM455.2m and earnings per share (EPS) of RM0.088 in 2026. The analysts are less bullish than they were before these results, given the reduced revenue forecasts and the small dip in earnings per share expectations.

View our latest analysis for Power Root Berhad

Despite the cuts to forecast earnings, there was no real change to the RM1.26 price target, showing that the analysts don't think the changes have a meaningful impact on its intrinsic value. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. There are some variant perceptions on Power Root Berhad, with the most bullish analyst valuing it at RM1.34 and the most bearish at RM1.20 per share. This is a very narrow spread of estimates, implying either that Power Root Berhad is an easy company to value, or - more likely - the analysts are relying heavily on some key assumptions.

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Power Root Berhad's past performance and to peers in the same industry. It's pretty clear that there is an expectation that Power Root Berhad's revenue growth will slow down substantially, with revenues to the end of 2026 expected to display 3.2% growth on an annualised basis. This is compared to a historical growth rate of 5.7% 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 5.2% per year. So it's pretty clear that, while revenue growth is expected to slow down, the wider industry is also expected to grow faster than Power Root Berhad.

The Bottom Line

The most important thing to take away is that the analysts downgraded their earnings per share estimates, showing that there has been a clear decline in sentiment following these results. Unfortunately, they also downgraded their revenue estimates, and our data indicates underperformance compared to the wider industry. Even so, earnings per share are more important to the intrinsic value of the business. There was no real change to the consensus price target, suggesting that the intrinsic value of the business has not undergone any major changes with the latest estimates.

With that said, the long-term trajectory of the company's earnings is a lot more important than next year. We have estimates - from multiple Power Root Berhad analysts - going out to 2028, and you can see them free on our platform here.

It is also worth noting that we have found 1 warning sign for Power Root Berhad that you need to take into consideration.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

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.