QL Resources Berhad Just Beat Revenue By 6.4%: Here's What Analysts Think Will Happen Next

It's been a good week for QL Resources Berhad (KLSE:QL) shareholders, because the company has just released its latest full-year results, and the shares gained 4.2% to RM5.16. Results overall were respectable, with statutory earnings of RM0.089 per share roughly in line with what the analysts had forecast. Revenues of RM5.2b came in 6.4% ahead of analyst predictions. Following the result, the analysts have updated their earnings model, and it would be good to know whether they think there's been a strong change in the company's prospects, or if it's business as usual. We've gathered the most recent statutory forecasts to see whether the analysts have changed their earnings models, following these results.

Check out our latest analysis for QL Resources Berhad

Taking into account the latest results, the current consensus from QL Resources Berhad's eleven analysts is for revenues of RM5.47b in 2023, which would reflect a satisfactory 4.2% increase on its sales over the past 12 months. Per-share earnings are expected to soar 22% to RM0.11. Before this earnings report, the analysts had been forecasting revenues of RM5.34b and earnings per share (EPS) of RM0.11 in 2023. So it's pretty clear consensus is mixed on QL Resources Berhad after the latest results; whilethe analysts lifted revenue numbers, they also administered a minor downgrade to per-share earnings expectations.

The consensus price target was unchanged at RM5.23, suggesting the business is performing roughly in line with expectations, despite some adjustments to profit and revenue forecasts. There's another way to think about price targets though, and that's to look at the range of price targets put forward by analysts, because a wide range of estimates could suggest a diverse view on possible outcomes for the business. There are some variant perceptions on QL Resources Berhad, with the most bullish analyst valuing it at RM5.75 and the most bearish at RM4.00 per share. Analysts definitely have varying views on the business, but the spread of estimates is not wide enough in our view to suggest that extreme outcomes could await QL Resources Berhad shareholders.

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. We would highlight that QL Resources Berhad's revenue growth is expected to slow, with the forecast 4.2% annualised growth rate until the end of 2023 being well below the historical 11% p.a. growth over the last five years. Compare this with other companies in the same industry, which are forecast to see a revenue decline of 1.0% annually. So it's clear that despite the slowdown in growth, QL Resources Berhad is still expected to grow meaningfully faster than the wider industry.

The Bottom Line

The biggest concern is that the analysts reduced their earnings per share estimates, suggesting business headwinds could lay ahead for QL Resources Berhad. Fortunately, they also upgraded their revenue estimates, and our data indicates sales are expected to perform better than the wider industry. The consensus price target held steady at RM5.23, with the latest estimates not enough to have an impact on their price targets.

Following on from that line of thought, we think that the long-term prospects of the business are much more relevant than next year's earnings. We have forecasts for QL Resources Berhad going out to 2025, and you can see them free on our platform here.

Before you take the next step you should know about the 1 warning sign for QL Resources Berhad that we have uncovered.

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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.